External factors considered in setting transfer prices in multinational firms typically do not include
A)the corporate income tax rates in host countries of foreign subsidiaries.
B)foreign monetary exchange risks.
C)environmental policies of the host countries of foreign subsidiaries.
D)actions of competitors of foreign subsidiaries.

Question

Quizplus · Accepted Answer

Environmental policies of the host countries of foreign subsidiaries are not typically considered in setting transfer prices. The other factors listed (corporate income tax rates, foreign monetary exchange risks, and actions of competitors) are commonly taken into account.

External Factors Considered in Setting Transfer Prices in Multinational Firms