The Hamlet of Smallville Had One Small Store That Provided

question 38

Multiple Choice

The hamlet of Smallville had one small store that provided all the basic necessities to the residents.The chain that owned the store decided to shut down the store as the hamlet was too small to allow the store to generate sufficient profits.The people of the town were upset and claimed that the damage that it caused them outweighed the harm caused to the chain by the reduced income.The store was closed.The store management applied the principle of ______ethic to this decision.

• A)economic efficiency
• B)self-interest
• C)justice
• D)personal virtues
• E)utilitarian

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Definitions:

First-In, First-Out

A rephrased definition: An inventory management strategy that assumes the items stocked first are the first to be sold, used to manage costs and inventory levels.

Inventory Costing

This is a method used to value inventory, including methods like FIFO (First-In, First-Out), LIFO (Last-In, First-Out), and weighted average cost.

Direct Materials

Raw materials that can be directly traced to the production of a specific good or service, considered part of the product's cost.

Process Cost System

A method of accounting used for industries where production is continuous, allocating costs to products based on the processes they go through.