Transfer pricing is a strategy used by multinational corporations to allocate costs from "summary" of International Financial Management, Abridged Edition by Jeff Madura
Transfer pricing is a strategy employed by multinational corporations to manage costs across different units within the organization. This practice involves setting prices for goods or services exchanged between different departments or subsidiaries of the company. The goal of transfer pricing is to allocate costs in a way that maximizes overall profitability for the organization. By using transfer pricing, multinational corporations can determine the value of products or services transferred between different parts of the company. This allows them to allocate costs effectively and make informed decisions about resource allocation. Transfer pricing helps multinational corporations optimize their operations and improve efficiency by ensuring that costs are allocated appropriately. One ...
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