Managers of MNCs May Attempt to Expand Their Divisions Internationally

question 42

True/False

Managers of MNCs may attempt to expand their divisions internationally if their compensation may be increased as a result of expansion. This goal is consistent with the goals of shareholders.

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Definitions:

Producer Surplus

The difference between the amount that producers are willing to accept for a good or service and the actual amount they receive in the market.

Externality

A cost or benefit from production or consumption that accrues to someone other than the immediate buyers and sellers of the product being produced or consumed (see negative externality and positive externality).

Third Party

An individual or group besides the two primarily involved in a transaction or legal matter, sometimes involved as an intermediary or independent party.

Transaction

An exchange or transfer of goods, services, or funds between two or more parties.