BU 457 KSU Multinational Enterprise Practices Questions

-3rd assignment 1.Explain and discuss in detail the term Transfer Pricing.  Your discussion, in addition to definingtransfer pricing, should include: (50 points)a.Why is transfer pricing used?b.How is transfer pricing used?c.What is the relationship of transfer pricing to revenue, net profit and costs /expense?d.How would a MNE use transfer pricing for services?e.What issues could arise when using transfer pricing?Hint: Use diagrams and another illustrations to help explain the questions above and use the language of international business as your instructor would2.What are the two ways that MNEs capitalize their subsidiaries?  Give an example of each. (40 points)3.What is a transfer pricing contract? (10 points)