Which Principle Suggests That Given Two Alternative Courses of Action

question 18

Multiple Choice

Which principle suggests that given two alternative courses of action, people will adopt the easiest course of action?

• A) Distance decay
• B) Least effort
• C) Circle theory
• D) All of the above

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Definitions:

Interest Expense

The charge an entity incurs for using borrowed capital over a set period.

Interest Payable

The amount of interest expense that has accumulated but has not been paid by the end of the accounting period.

360-Day Year

An accounting assumption that a year consists of 360 days, which simplifies interest calculation by assuming each month has 30 days.

Warranty Expense

Costs a company incurs due to honoring a product warranty, covering repair and replacement of faulty products.