Which of the following answers is why the form of nonprofits with nonprofit subsidiaries might be adopted?
A) In order to undertake business activities that are not related to the parent organization's mission but that generate revenue
B) In order to increase the prospects of receiving certain grants
C) In order to avoid a loss of grant money from funders that reduce their grants if other revenue sources are found by creating a subsidiary nonprofit to retain earnings
D) All three answers are applicable

Question

Quizplus · Accepted Answer

All of the given answers are applicable reasons for adopting the form of nonprofits with nonprofit subsidiaries. Nonprofit subsidiaries can undertake business activities not related to the parent organization's mission and generate revenue, increase the chances of receiving certain grants, and avoid losing grant money from funders that reduce their grants if other revenue sources are found by creating a subsidiary nonprofit to retain earnings.

Which of the Following Answers Is Why the Form of Nonprofits