When a Department or Product Line Is Dropped, the Common

question 114

Multiple Choice

When a department or product line is dropped, the common fixed costs which had been allocated to that department:

• A) are eliminated.
• B) become variable costs.
• C) are allocated to the remaining departments or product lines.
• D) become sunk costs.

Comprehend the impact of specific laws and trends on corporate listings and governance in the U.S.

Analyze the consequences of managers making decisions that override explicit instructions or exceed their authority.

Understand the concept and requirements for forming a quorum in corporate decision-making.

Differentiate between corporate directors, special interest groups, stakeholders, and shareholders.

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Definitions:

Technological Advances

Innovations and improvements in technology that enhance productivity, efficiency, and product quality.

Celler-Kefauver Act

Extended the government’s authority to control mergers.

Vertical Mergers

A type of merger between companies that operate at different stages of the production process for a specific finished product, enhancing efficiency or reducing costs.

Conglomerate Mergers

A type of merger where two or more companies in unrelated industries combine business operations to reduce risk and diversify their business interests.