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Discuss the propriety of using transfer pricing strategies to influence profitability
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- Many companies that have profit centres and/or investment divisions in different countries use transfer pricing to manage their profitability as a strategy to reduce tax payments. QUESTIONS Define the term transfer pricing Explain four (4) reasons why determining a fair transfer price is important to division managers. Discuss the propriety of using transfer pricing strategies to influence profitability.Alibaba is a Chinese e-commerce firm similar to Amazon.com in the United States. It has increased its power and global influence with strong leadership from its founder, including knowing when to acquire other organizations. For instance, in addition to acting as a platform for buyers to purchase products, it also acquired firms in the delivery and payments industries so it would have more control over the entire process. Alibaba's acquisitions are an example of a) full-line forcing. b) vertical channel integration. c) channel cooperation. d) horizontal channel integration. e) digital distribution.How can Indigo sustain its profitability under following scenarios;i. Sustaining Profits by reducing cost ii. Increasing profits by raising prices iii. Demand falls
- Based on the herfinfahl index of the market for sunglasses, the FTC would _______ a merger between UV shield and sun fashion.One of the many mergers that have occurred around the world is Amazon. com-AMC Entertainment. Explain the nature of the merger between these two businesses. Determine the economic motivations for the merger, as well as ONE of its cost-of-production implications.According to International Data Corporation (IDC), the number of worldwide smartphone owners will soon exceed 1.5 billion. That number is expected to grow at nearly 10 percent per year for the next five years. While the actual cost of a smartphone is about $300, wireless carriers in some countries offer their customers a “free” smartphone with a two-year wireless service agreement. Is this pricing strategy rational? Explain
- The following are the demand and supply functions for three competing mobile phone models ofdifferent manufacturers. ??? = ?? − ???? + ??? + ?????? = ???? − ????? = ?? + ??? − ??? + ?????? = ??? − ????? = ?? + ??? + ??? − ?????? = ??? − ??Using Gaussian Elimination Method determine whether there are prices which would bring thesupply and demand levels into equilibrium for each of the three mobile phone models. If so, what are the equilibrium demand and supply quantities?You may get the three equations of market equilibrium condition by equating ???with ??? , ??? ???? ??? and ??????? ???.In 2005, Hydrola make and updated their website with different languages, which enables the foreign customer to view and build an international network between them, which that lead to the company expand in the region without local intermediaries due to the internationalization of the organizational culture. Following the creation of its website, Hydrola received numerous expressions of interest from abroad. Contrary to the CEO's expectations, requests were not coming from European and American markets, but rather from Africa, the Middle East, and Latin America. The company has selected Tunisia, Senegal, and Mexico as the initial choice of expansion markets. Hydrola's business is the production and maintenance of hydraulic and pneumatic spare parts for industrial machinery. Besides the countries mentioned above, what other countries are potential expansions for Hydrola? Please propose 5 countries and the reason (Except for China), and the 5 main indicators related to export strategy…E63. Explain how transfer pricing is generally used by a multinational corporation as a method of increasing profit. Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.