_______ from the subsidiary to the parent is still the MOST important method of transferring funds in the MNC.
A) Parallel loans
B) Leading and lagging
C) Dividends
D) Credit rationing

Question

Quizplus · Accepted Answer

Dividends from the subsidiary to the parent company are the most important method of transferring funds in an MNC because they do not require any external funding or borrowing. Dividends are paid out of profits, so they do not increase the debt levels of the parent company. Additionally, dividends can provide a tax advantage for the parent company in some situations. While parallel loans and leading and lagging can also be used to transfer funds, they are not as important as dividends. Credit rationing is not a method of transferring funds, but rather a situation where credit is restricted or limited.

_______ from the Subsidiary to the Parent Is Still the MOST