Which of the Following Is a Key Problem with the Use

question 68

Multiple Choice

Which of the following is a key problem with the use of market-based transfer prices?

• A) It does not take into account the saving in cost (e.g. selling expenses, collection expenses) because of transferring internally.
• B) It leads to decision making that is suboptimal for the firm.
• C) It does not promote divisional autonomy.
• D) It does not show the contribution of each division to overall profit.

---

Definitions:

Theme Effects

In software design, these are visual enhancements applied to elements within a theme, such as fonts, colors, and styles, to maintain a cohesive appearance.

Print Layout

A view mode in document editing software that shows how the document will appear when printed.

Read Mode

A viewing option available in some document readers and web browsers that simplifies the page layout to improve readability.

Web Layout

A mode in word processing and web design that presents a document as it would appear in a web browser, focusing on how content flows across different screen sizes.