One argument for why subsidiaries should be whollyowned by the parent is that:
A) the potential conflict of interests between the MNC's managers and shareholders is avoided.
B) the potential conflict of interests between the MNC's majority shareholders and minority shareholders is avoided.
C) the potential conflict of interests between the MNC's existing creditors is avoided.
D) the potential conflict of interests between the MNC's managers and creditors is avoided.

Question

Quizplus · Accepted Answer

Wholly owning a subsidiary avoids conflicts between majority and minority shareholders, as the parent company has full control and there are no minority interests to consider.

One Argument for Why Subsidiaries Should Be Whollyowned by the Parent