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1. Why do companies invest in other companies? Give some important reasons to illustrate your points. 2. Why is the equity method not used in

1. Why do companies invest in other companies? Give some important reasons to illustrate your points.

2. Why is the equity method not used in consolidation? In your answer, compare methods for marketable security investment and the equity method.

3. What are the indicators for control? What is the variable interest entity? Do you think VIE is a kind of control? Why or why not?

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