Which of the Following Is an Opportunity Cost That Should

question 100

Multiple Choice

Which of the following is an opportunity cost that should be considered in an outsourcing decision?

• A) Staff morale
• B) Benefits from alternate uses of released capacity
• C) Unavoidable fixed costs
• D) Taxation implications of the decision

---

Definitions:

Short-term Investments

Financial assets that are expected to be converted into cash or sold within a year or the operating cycle, whichever is longer.

Current Liabilities

Short-term financial obligations that are due to be paid within one year, such as accounts payable, short-term loans, and taxes owed.

Accounts Receivable Turnover

A measure of the liquidity of accounts receivable; computed by dividing net credit sales by average net accounts receivable.

Net Credit Sales

The total amount of sales made on credit, minus any returns or allowances.