Deck 15: Understanding the Roles of Finance and Accounting in Global Competitive Advantage

Question 1

Multinational firms often organize as separate legal entities (i.e., companies) in different countries to gain advantages, such as limiting liability or taking advantage of local corporate tax regulations.

Answer 1

True

Question 2

Adopting different accounting standards makes it easier for investors or lenders to compare the financial health of two companies.

Answer 2

False

Question 3

The purpose of accounting is to communicate the organization's financial position to company managers, investors, banks, and the government.

Answer 3

True

Question 4

Adhering to GAAP as well as IFRS helps companies in creating globally shared service center for accounting, rather than having accounting departments in different regions.

Question 5

Investors and banks use financial statements to determine whether to invest in or loan capital to the firm.

Question 6

An interim step toward the United States adopting IFRS would be to permit US firms that operate globally to file only under IFRS, rather than under both GAAP and IFRS, thereby reducing their financial-statement preparation costs.

Question 7

The disadvantage of raising capital in equity markets is that the firm has to repay the money at a specific time and at a specific interest rate.

Question 8

Premium pricing, bank fees, and interest payments are costs associated with the current-rate method of foreign-currency translation.

Question 9

Most IASB statements provide three acceptable alternatives since it is difficult to get an agreement while formulating the international reporting standards.

Question 10

Governments use financial statements to ensure that the companies are paying their fair share of taxes.

Question 11

Most of the developed nations require consolidated statements so that losses can't be hidden under an unconsolidated subsidiary.

Question 12

Some large Chinese companies report results in both Chinese accounting standards and the IASB's standards to facilitate the financial assessment of the companies by the investors.

Question 13

The current-rate method avoids the paper gains or losses problem of the temporal method.

Question 14

Consolidating financial statements of subsidiaries located in different countries poses problems because of the different currencies used in different countries.

Question 15

In countries where companies tend to rely more on banks for funding, accounting rules are framed such that assets are valued conservatively to protect a bank's investment.

Question 16

In countries like Switzerland, Germany, and Japan, accounting rules are designed to help individual investors.

Question 17

The consolidated financial statement must reconcile all the investment and capital accounts as well as the firms' assets, liabilities, and operating accounts.

Question 18

Some companies may gain greater efficiencies and stronger controls by making a move from the GAAP to the IFRS.

Question 19

In the United States and Great Britain, companies tend to rely more on banks for funding than on individual investors.

Question 20

Some governments court foreign borrowers by offering low-interest loans or by offering lower corporate income tax to attract investment in their countries.

Question 21

Which of the following statements holds true for generally accepted accounting principles (GAAP)?

A)It refers to a set of accounting standards issued by theInternational Public Sector Accounting Standards (IPSAS) Board for use by public sector entities throughout the world to prepare their financial statements.
B)It refers to the standards developed by the International Accounting Standards Board (IASB) for reporting company financial results and that are followed by over one hundred nations throughout the world.
C)It refers to the set of standards that are developed by the European Union for reporting any discrepancies in financial reporting by non-EU firms.
D)It refers to the standards that are developed by the International Monetary Fund to assess the financial strength and credit worthiness of countries throughout the world.
E)It refers to the standards that are developed by the US Financial Accounting Standards Board (FASB) for reporting company financial results and that all US companies or companies operating in the US must follow.

Question 22

The advantage of raising money through debt financing is that company management doesn't give up any ownership of the firm.

Question 23

Despite the costs associated with a forward contract, companies often prefer it to protect themselves against a potential larger downside loss.

Question 24

A company needs to buy US dollars in 90 days time.Therefore it signs a contract with a US bank to buy US dollars in exchange for euros 90 days from now at a specified exchange rate.The company would most likely use the _____ as a way to reduce exchange-rate risk if the value of the euro decreases substantially relative to the US dollar.

A)forward exchange rate
B)effective interest rate
C)spot exchange rate
D)internal forward rate
E)temporal rate

Question 25

Which of the following statements holds true for hedging?

A)It refers to using financial instruments to reduce adverse price movements by taking an offsetting position.
B)It refers to the simultaneous and instantaneous purchase and sale of a currency for a profit.
C)It refers to a strategy that ensures that a change in interest rates does not affect the value of a portfolio.
D)It refers to the practice of buying and selling a currency with the expectation that the value will change and result in a profit.
E)It refers to the method of bringing all financial statements of a parent and its subsidiaries into a single financial statement.

Question 26

Subsidiaries purchase assets at different times throughout the year and therefore the balance sheet of a multinational firm may not balance if the current-rate method is used.

Question 27

Which of the following statements holds true for international financial reporting standards (IFRS)?

A)It refers to a set of accounting standards issued by theInternational Public Sector Accounting Standards (IPSAS) Board for use by public sector entities throughout the world to prepare their financial statements.
B)It refers to the standards that are developed by the International Accounting Standards Board (IASB) for reporting company financial results and that are followed by over one hundred nations throughout the world.
C)It refers to the set of standards developed by the European Union for reporting any discrepancies in financial reporting by non-EU firms.
D)It refers to the standards that are developed by the International Monetary Fund to assess the financial strength and credit worthiness of countries throughout the world.
E)It refers to the standards that are developed by the US Financial Accounting Standards Board (FASB) for reporting company financial results and that all US companies or companies operating in the US must follow.

Question 28

_____ refers to a method of foreign currency translation in which items in the subsidiaries' financial statements are translated at the current exchange rate into the currency of the parent corporation.

A)Hedging process
B)Current-rate method
C)Monte Carlo method
D)Temporal method
E)Markov process

Question 29

_____ refers to a method of foreign currency translation that uses exchange rates based on the rate at which the assets and liabilities were originally acquired or incurred.

A)Hedging process
B)Current-rate method
C)Monte Carlo method
D)Temporal method
E)Markov process

Question 30

Which of the following statements about the GAAP rules and IFRS is true?

A)The last-in, first-out (LIFO) accounting method is allowed by IFRS but banned by GAAP.
B)All companies listed on EU stock exchanges are required to use GAAP, while those listed on the New York stock exchange are required to use IFRS.
C)A US company seeking to raise funds in Germany has to prepare a financial reporting according to GAAP rules only.
D)Adhering to US GAAP rules as well as IFRS creates extra labor and paperwork for multinational firms.
E)China is the only country where accounting rules follow both GAAP and IFRS.

Question 31

Companies face currency risk because they typically price their products and services in the local currency of each country in which they operate.

Question 32

Which of the following statements holds true for accounting standards?

A)It refers to a statement that contains details of all a country's economic transactions with the rest of the world, for a given time period, usually one year.
B)It refers to the sale of securities under a negotiated agreement between an issuer and the investing institution, as an alternative to a public issue.
C)It refers to the rate of interest charged by the Federal Reserve Bank on financial accommodation extended to banks and financial institutions.
D)It refers to a system of rules and principles that prescribe the format and content of financial statements.
E)It refers to government securities that have the highest degree of reliability.

Question 33

An Indonesian importer needs U.S.dollars to pay for the shipment that he has just received.He will have to purchase the dollars to pay for the shipment.He exchanges rupiah for U.S.dollars which he pays to the foreign exporter.The rate at which he buys US dollars in the market is known as the _____.

A)forward exchange rate
B)effective interest rate
C)spot exchange rate
D)internal forward rate
E)temporal rate

Question 34

Which of the following statements holds true for a consolidated financial statement?

A)It is a part of a nation's balance of payments that includes purchases and sales of assets, such as stocks, bonds, and land.
B)It demonstrates that firms-that are legally separate from the parent and each other-are economically independent too.
C)It is a statement part of a nation's balance of payments which includes the value of all goods and services imported and exported, as well as the payment and receipt of dividends and interest.
D)It is a written, dated, and signed three-party instrument containing an unconditional order by a drawer that directs a drawee to pay a definite sum of money to a payee on demand or at a specified future date.
E)It brings together all the financial statements of a parent and its subsidiaries into a single financial statement.

Question 35

In which of the following countries is the use of the international financial reporting standards (IFRS) not mandatory?

A)South Africa
B)Turkey
C)Germany
D)France
E)United States of America

Question 36

Which of the following statements holds true for a forward contract?

A)It refers to the method of foreign-currency translation in which items in the subsidiaries' financial statements are translated into the currency of the parent corporation at the current exchange rate.
B)It refers to the company-generated forecast of future spot exchange rates between two trading partners.
C)It refers to a method of foreign-currency translation that uses exchange rates based on the rate in place when the assets and liabilities were originally acquired or incurred.
D)It refers to the contract between two parties to buy or sell an asset today.
E)It refers to an agreement in which a firm agrees to pay a specific rate at the beginning of the contract for delivery at a future date.

Question 37

An organization wants to raise cash in order to fund its expansion plans.The company that currently has 500,000 ordinary shares decides to issue 125,000 new shares to raise cash.The above is an example of:

A)debt financing.
B)capital budgeting.
C)equity financing.
D)multilateral netting.
E)fronting loan.

Question 38

Two month ago, the Indian subsidiary of a US-based MNC purchased three Caterpillars for its mining work.At the end of the financial year, the financial statements of the subsidiaries need to be translated into the currency of the parent corporation.When the Caterpillars were purchased, the exchange rate was 50 INR= 1USD.The present exchange rate is 60 INR= 1USD.The financial statement of the Indian subsidiary is translated into the currency of the parent corporation at the exchange rate of 60 INR= 1USD.The above serves as an example of the _____ of foreign-currency translation.

A)Wiener process
B)current-rate method
C)Monte Carlo method
D)temporal method
E)Markov process

Question 39

The internal forward rate is a company-generated forecast of future spot-exchange rates.

Question 40

The _____ is the major entity proposing international standards of accounting and was formerly known as the International Accounting Standards Committee (IASC).

A)International Public Sector Accounting Standards (IPSAS) Board
B)US Financial Accounting Standards Board (FASB)
C)International Accounting Standards Board (IASB)
D)Federal Reserve Bank (FRBA) of America
E)Australian Accounting Standards Board (AASB)

Question 41

Which of the following statements holds true for transnational financing?

A)It refers to the process of financing major projects such as plant expansion in different countries, entry into new countries, or research and development in new countries.
B)It refers to investing capital in foreign markets.
C)It refers to the process and a set of procedures used to estimate the economic value of an owner's interest in a transnational business.
D)It refers to seeking capital from foreign sources.
E)It refers to a technique that companies use to reduce the costs of cross-border payments between subsidiaries.

Question 42

_____ refers to the organized trading of securities through exchanges.

A)Commodity market
B)Currency market
C)Stock market
D)Futures market
E)Gray market

Question 43

Which of the following statements holds true for trade credit?

A)It refers to the process of financing long-term outlays for major projects such as plant expansion, entry into new markets, or research and development.
B)It refers to raising capital by borrowing the money and agreeing to repay the entire amount plus agreed-upon interest at a specific date in the future.
C)It refers to a process that lets the customer buying the goods or services defer payment on the good or services for a specified period of time, typically thirty or ninety days.
D)It refers to the process and a set of procedures used to estimate the economic value of an owner's interest in a business.
E)It refers to the rate of return that a company could earn if it chose a different investment of equivalent risk.

Question 44

The Mexican subsidiary of an American durables giant acquired a market research firm a few months ago.The rate of exchange at the time of acquisition was 12 pesos= 1 dollar.At the end of the financial year the subsidiaries' financial statements need to be translated into the currency of the parent corporation.The current exchange rate is 10 pesos= 1 dollar.The subsidiaries' financial statement is translated into the currency of the parent corporation at the exchange rate of 12 pesos= 1 dollar.The above serves as an example of the _____ of foreign-currency translation.

A)hedging process
B)current-rate method
C)Monte Carlo method
D)temporal method
E)Markov process

Question 45

Which of the following statements holds true for fronting loan?

A)It refers to the process of financing long-term outlays for major projects such as plant expansion, entry into new markets, or research and development.
B)It refers to raising capital by borrowing the money and agreeing to repay the entire amount plus agreed-upon interest at a specific date in the future.
C)It refers to a process which in which the parent company directly gives a loan to its subsidiary.
D)It refers to the funding of the subsidiary by the parent company through a financial intermediary such as a bank.
E)It refers to the loan on which the bank charges companies a slightly lower rate of interest for expanding operations in developing countries.

Question 46

GE is commissioned to build a new power station for which the overall construction effort is contracted through GE Power Systems.But in addition to generators, GE may need other items such as switching technology or light fixtures that are manufactured by its subsidiary.GE Power Systems would purchase items it doesn't manufacture internally from GE Automation, another subsidiary of GE and then sell them on to the customer as part of the construction project.The above serves as an example of:

A)debt financing.
B)capital budgeting.
C)equity financing.
D)transfer pricing.
E)multilateral netting.

Question 47

On January 1, 2009, Company X signs an agreement to import 100 pounds of coffee from Company Y on April 1, 2009 at a price of $5.00 per pound.On April 1, 2009, the market price of coffee is $6.00 a pound.Instead of having to pay $6.00 a pound for coffee, the importer needs to pay $5.00.However, the importer's gain is the exporter's loss.The exporter must now sell 100 pounds of coffee at only $5.00 per pound even though it could have sold it in the open market for $6.00 per pound if it had not signed the agreement.The above is an example of a(n):

A)forward contract.
B)absolute return.
C)forward exchange rate.
D)Swap agreement.
E)internal forward rate.

Question 48

_____ refers to all the stock exchanges worldwide where firms can buy and sell stock for financing an investment.

A)Global equity market
B)Commodity market
C)Currency market
D)Futures market
E)World trade market

Question 49

The _____ is the most widely used currency-translation method.

A)Hedging process
B)current-rate method
C)Monte Carlo method
D)temporal method
E)Markov process

Question 50

Which of the following statements holds true for a spot exchange rate?

A)It refers to the weighted average of a basket of foreign currencies.
B)It refers to the rate at which two parties agree to exchange currency and execute a deal that takes place immediately.
C)It refers to the rate that determines the pay-offs in a financial contract and that is outside the control of the parties to the contract.
D)It refers to the rate at which two parties agree to exchange currency and execute a deal at some specific point in the future, usually 30 days, 60 days, 90 days, or 180 days in the future.
E)It refers to the exchange rate based on the rate in place when the assets and liability were originally acquired or purchased.

Question 51

Which of the following statements holds true for transnational investment?

A)It refers to the process of financing major projects such as plant expansion in different countries, entry into new countries, or research and development in new countries by taking loans from banks in the home country.
B)It refers to investing capital in foreign markets.
C)It refers to the organized trading of securities through exchanges.
D)It refers to seeking capital from foreign sources.
E)It refers to a technique that companies use to reduce the costs of cross-border payments between subsidiaries.

Question 52

Which of the following statements holds true for multilateral netting?

A)It refers to the process of financing long-term outlays for major projects such as plant expansion, entry into new markets, or research and development.
B)It refers to raising capital by borrowing the money and agreeing to repay the entire amount plus agreed-upon interest at a specific date in the future.
C)It refers to raising capital by selling shares of stock across countries.
D)It refers to a set of procedures used to estimate the economic value of an owner's interest in a business.
E)It refers to a technique that companies use to reduce the costs of cross-border payments between three or more subsidiaries.

Question 53

Which of the following statements holds true for capital budgeting?

A)It refers to the process of financing long-term outlays for major projects such as plant expansion, entry into new markets, or research and development.
B)It refers to raising capital by borrowing the money and agreeing to repay the entire amount plus agreed-upon interest at a specific date in the future.
C)It refers to raising capital by selling shares of stock.
D)It refers to a set of procedures used to estimate the economic value of an owner's interest in a business.
E)It refers to a technique that companies use to reduce the costs of cross-border payments between subsidiaries.

Question 54

Which of the following statements holds true for debt financing?

A)It refers to the process of financing long-term outlays for major projects such as plant expansion, entry into new markets, or research and development.
B)It refers to raising capital by borrowing the money and agreeing to repay the entire amount plus agreed-upon interest at a specific date in the future.
C)It refers to raising capital by selling shares of stock.
D)It refers to a set of procedures used to estimate the economic value of an owner's interest in a business.
E)It refers to technique that companies use to reduce the costs of cross-border payments between subsidiaries.

Question 55

Which of the following statements holds true for forward exchange rates?

A)It refers to the weighted average of a basket of foreign currencies.
B)It refers to the rate at which two parties agree to exchange currency and execute a deal that takes place immediately.
C)It refers to the rate that determines pay-offs in a financial contract and that is outside the control of the parties to the contract.
D)It refers to the rate at which two parties agree to exchange currency and execute a deal at some specific point in the future, usually 30 days, 60 days, 90 days, or 180 days in the future.
E)It refers to a form of exchange traded derivative whose underlying value is the rate on various financial interest rates, including treasury bills and bonds.

Question 56

Which of the following statements holds true for cost of capital?

A)It refers to the process of financing long-term outlays for major projects such as plant expansion, entry into new markets, or research and development.
B)It refers to raising capital by borrowing the money and agreeing to repay the entire amount plus agreed-upon interest at a specific date in the future.
C)It refers to a process that lets the customer buying the goods or services defer payment on the good or services for a specified period of time, typically thirty or ninety days.
D)It refers to a set of procedures used to estimate the economic value of an owner's interest in a business.
E)It refers to the rate of return that a company could earn if it chose a different investment of equivalent risk.

Question 57

Which of the following statements holds true for a centralized financial organization structure?

A)The government of the host country in which the subsidiary is located makes financing or investment decisions for the organization, taking advantage of local knowledge and moving quickly to respond to opportunities or uncertainties.
B)Multinational firms choose a centralized financial organization structure due to variations in language, consumers, cultures, business practices, and government rules, laws, and regulations among different countries.
C)Subsidiaries or regions make financing or investment decisions for their region, taking advantage of local knowledge and moving quickly to respond to opportunities or uncertainties.
D)The financial institutions which fund the organization set guidelines for the headquarters as well as the subsidiaries to follow, pool funds, leverage the benefits of scale for investment and borrowing, and hire knowledgeable staff to make the most effective firm-wide decisions.
E)All finance decisions are performed at headquarters, which sets guidelines for subsidiaries to follow, pools funds, leverages the benefits of scale for investment and borrowing, and hires knowledgeable staff to make the most effective firm-wide decisions.

Question 58

Joan wants to buy a new loom for her weaving business.She applies to a bank for a loan of $50,000.It is a long-term loan that she intends to pay in five years time at a fixed interest rate.This is an example of:

A)debt financing.
B)capital budgeting.
C)equity financing.
D)trade credit.
E)multilateral netting.

Question 59

The advantage of the _____ agreement between the parent and foreign subsidiaries is that if the exchange rate changes, the subsidiary will be not be blamed or credited for the change.

A)forward exchange rate
B)effective interest rate
C)spot exchange rate
D)internal forward rate
E)temporal rate

Question 60

Which of the following statements holds true for equity financing?

A)It refers to the process of financing major projects such as plant expansion, entry into new markets, or research and development by taking loans from private banks.
B)It refers to the process of raising capital by borrowing the money and agreeing to repay the entire amount plus agreed-upon interest at a specific date in the future.
C)It refers to raising capital by selling shares of stock.
D)It refers to a set of procedures used to estimate the economic value of an owner's interest in a business.
E)It refers to a technique that companies use to reduce the costs of cross-border payments between subsidiaries.

Question 61

Why do multinational firms choose to raise money in foreign markets?

Question 62

Which of the following statements holds true for a decentralized financial organization structure?

A)The government of the host country in which the subsidiary is located makes financing or investment decisions for the organization, taking advantage of local knowledge and moving quickly to respond to opportunities or uncertainties.
B)A decentralized financial organization structure enables the firm to gain economies of scale for investment and borrowing activities that can reduce transaction costs and provide the firm with the most competitive pricing.
C)Subsidiaries or regions make financing or investment decisions for their region, taking advantage of local knowledge and moving quickly to respond to opportunities or uncertainties.
D)The financial institutions which fund the organization set guidelines for the headquarters as well as the subsidiaries to follow, pool funds, leverage the benefits of scale for investment and borrowing, and hire knowledgeable staff to make the most effective, firm-wide decisions.
E)All finance decisions are performed at headquarters, which sets guidelines for subsidiaries to follow, pools funds, leverages the benefits of scale for investment and borrowing, and hires knowledgeable staff to make the most effective, firm-wide decisions.

Question 63

What facts must be considered by an organization when using centralized depositories?

Question 64

Two friends consider opening a driving range for golfers.They estimate such a range could generate rentals of 20,000 buckets at $3 a bucket in the first year, and expect rentals to grow at 750 buckets a year thereafter.The equipment requirements include ball dispensing machines, the ball pick-up, and the vehicle tractor that will cost $8,000, $2,000, and $8,000 respectively.The net working capital is $3,000 to start with, and is expected to grow at 5% per year.The annual fixed operating cost for balls and baskets will initially be $3,000 and is expected to grow at 5% per year.The fixed costs of leasing the land and its upkeep will be $53,000 per year.The above is an example of:

A)debt financing.
B)capital budgeting.
C)equity financing.
D)trade credit.
E)multilateral netting.

Question 65

Why do some firms choose a decentralized financial organization structure?

Question 66

What are the reasons for adopting one global accounting standard across the financial world?

Question 67

_____ refers to the pricing that takes place between entities owned by the same parent firm where one subsidiary (or subunit of the company) charges another subsidiary (or subunit) for a product or service supplied to that subsidiary.

A)Competition-based pricing
B)Limit pricing
C)Penetration pricing
D)Premium pricing
E)Transfer pricing

Question 68

How is Indonesia making itself attractive to foreign investors?

Question 69

An American aircraft manufacturer has a subsidiary in Indonesia.The subsidiary needs funding to expand its operations.The parent company deposits the required funds in a London based international bank.The money is then transferred to the subsidiary by the bank.The above serves as an example of:

A)debt financing.
B)transfer pricing.
C)equity financing.
D)trade credit.
E)fronting loan.

Question 70

An ice cream vendor signs a franchising agreement with the distributor.Under the agreement the distributor agrees to provide ice cream stock with a 10% discount on payment within 30 days, and a 20% discount on payment within 10 days.The distributor allows the operator 90 days to pay for the ice cream stock in full.The above serves as an example of:

A)debt financing.
B)capital budgeting.
C)equity financing.
D)trade credit.
E)loan fronting.

Question 71

Which of the following statements holds true for "mudarabah," an investment partnership approved by the Sharia?

A)It refers to a partnership in which one partner takes part in financial practices like charging interest on money, speculation, insurance, and derivatives.
B)It refers to a partnership that allows a special partner whose name does not appear in that of the firm, to invest a limited amount of capital and to receive a corresponding share of the profits and to bear any corresponding losses.
C)It refers to a partnership in which the profits are shared on an agreed-upon ratio but the loss of investment is borne only by the investor.
D)It refers to a partnership whereby the individuals agree to share the profits and losses together without fixing any limitations or conditions.
E)It refers to a partnership wherein profits are shared according to an agreed-upon ratio and losses are shared in proportion to the capital or investment of each partner.

Question 72

What are the tax advantages of fronting loans by a subsidiary located in a tax haven?

Question 73

What alternatives to interest and speculative investments are approved by Sharia?

Question 74

What are the disadvantages of transfer pricing?

Question 75

What are the advantages of a centralized structure in an organization?

Question 76

Which of the following statements holds true for "musharakah," an investment partnership approved by the Sharia?

A)It refers to a partnership in which the investor provides capital to another party or entrepreneur in order to undertake a business or investment activity.
B)It refers to a partnership which allows a special partner, whose name does not appear in that of the firm, to put in a limited amount of capital and to receive a corresponding share of the profits.
C)It refers to a partnership, wherein the profits are shared on an agreed-upon ratio but the loss of investment is borne only by the investor.
D)It refers to a partnership wherein the individuals agree to share the profits and losses together without fixing any limitations or conditions.
E)It refers to a partnership wherein profits are shared per an agreed-upon ratio and losses are shared in proportion to the capital or investment of each partner.

Question 77

Which of the following statements is true about bilateral netting?

A)It refers to the process of financing long-term outlays for major projects such as plant expansion, entry into new markets, or research and development.
B)It refers to raising capital by borrowing the money and agreeing to repay the entire amount plus agreed-upon interest at a specific date in the future.
C)It refers to raising capital by selling shares of stock across many countries.
D)It refers to a set of procedures used to estimate the economic value of an owner's interest in a business.
E)It refers to a technique that companies use to reduce the costs of cross-border payments between two subsidiaries.

Question 78

Sharia prohibits "gharar" which means "_____" and includes conventional practices like short selling.

A)interest rate
B)uncertainty
C)gambling
D)lease
E)partnership

Question 79

Which of the following statements holds true for indirect tax?

A)It refers to the tax levied on the value of a property that the owner of the property is required to pay to the government of the country in which the property is located.
B)It refers to the tax that is shifted to another person or entity, like the value-added tax (VAT), which is levied on the seller but is passed on and paid by buyer.
C)It refers to the tax that is levied on the HYPERLINK "http://en.wikipedia.org/wiki/Income" \o "Income" income of individuals or businesses (corporations or other legal entities).
D)It refers to the tax that is levied on the passing of HYPERLINK "http://en.wikipedia.org/wiki/Title_%28property%29" \o "Title (property)" title to HYPERLINK "http://en.wikipedia.org/wiki/Property" \o "Property" property from one person (or entity) to another.
E)It refers to the HYPERLINK "http://en.wikipedia.org/wiki/Tax" \o "Tax" tax that is levied on and paid by the seller.

Question 80

What is the role of government in terms of international business and finance?