as sach described the tranfer pricing policy, purely domestic transfers utilized a full standard cost price method while foreign transfer used an arm is -length market price method.this was the general rule, but the system was quite flexible, which enabled a quick response to changing market conditions. the document processing industry was extremely competitive, and xerox management realized that they must respond to various global market pressures and competitive challenges. a manager from the xerox brazilian operation asserted the following:"the transfer pricing system is designed to attack the market place. we drive the products in the market place, and xerox knows the source of the revenue is the customer".