Transfer pricing by MNCs may be a problem for host countries as a. It disadvantages MNCs realtive to local firms. b. the cost of exchanging one currency for another is costly in monetary terms and time. c. profits may not be accurately recorded as occurring in the host country leading to lower tax revenues. d. as prices are transferred t
Transfer pricing by MNCs may be a problem for host countries as a. It disadvantages MNCs realtive to local firms. b. the cost of exchanging one currency for another is costly in monetary terms and time. c. profits may not be accurately recorded as occurring in the host country leading to lower tax revenues. d. as prices are transferred t
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Transfer pricing by MNCs may be a problem for host countries as
a. It disadvantages MNCs realtive to local firms.
b. the cost of exchanging one currency for another is costly in monetary terms and time.
c. profits may not be accurately recorded as occurring in the host country leading to lower tax revenues.
d. as prices are transferred to the local currency losses may occur if exchange takes place on a day when the exchange rate is "low".
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