Which of the following is true? Many large U.S corporations have more sales and profits in...

Which of the following is true?

	Many large U.S corporations have more sales and profits in foreign companies than in the U.S.
	The U.S. has lower corporate taxes than most other industrialized nations.
	Legally, a U.S. corporation must have the majority of its sales in the U.S.
	Globalization has harmed the sales of most U.S. corporations.

Expert Solution

Option 1 is true .

Many large U.S corporations have more sales and profits in foreign companies than in the U.S.

Reason : Big U.S. firms—often called "multinationals," for good reason—have increasingly followed global growth, with about 40 percent of profit for firms listed in the S&P 500 stock index now coming from overseas. Foreign exposure allows U.S.-based companies to capitalize on rapid growth in emerging markets like China, India, and Latin America, and earn much stronger profits than if they were totally dependent on the struggling U.S. economy. It's true that some U.S. multinationals hire cheap foreign workers instead of Americans, and keep certain profits overseas to avoid paying U.S. taxes on them. But they also sell their goods and services in global markets that would be dominated by foreign competitors if the American firms weren't there. To explore the extent to which U.S. firms depend on foreign sales.

jeff jeffy answered 2 years ago

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