The ___________ at which the company's products or inputs are traded internally can significantly cause errors in evaluating the profitability of proposed investments.

Question

Quizplus · Accepted Answer

Transfer pricing refers to the price at which goods and services are transferred between different units or divisions of a company. If the transfer price is set too high or too low, it can distort the profitability of investments as it affects the true cost of inputs and revenue from outputs. Therefore, transfer pricing can significantly cause errors in evaluating the profitability of proposed investments.

The ___________ at Which the Company's Products or Inputs Are