Assuming that a subsidiary is wholly owned, the subsidiary's perspective is appropriate in attempting to determine whether a project will enhance the firm's value.

Question

Quizplus · Accepted Answer

From the perspective of the parent company, the decision on whether a project will enhance the firm's value should be made, as the parent company's interests encompass the overall health and value of the entire firm, including all subsidiaries.

Assuming That a Subsidiary Is Wholly Owned, the Subsidiary's Perspective