Reference: 09-06
Clemson Company Reported the Following Results Last Year

question 70

Multiple Choice

Reference: 09-06
Clemson Company reported the following results last year for the manufacture and sale of one of its products known as a Tam. $$\begin{array} { | l | r | } \hline \text { Sales } ( 6,500 \text { Tams at } \$ 130 \text { each } ) & \$ 845,000 \\\hline \text { Variable cost of sales } & 390,000 \\\hline \text { Variable distribution costs } & 65,000 \\\hline \text { Fixed advertising expense } & 275,000 \\\hline \text { Salary of product line manager } & 25,000 \\\hline \text { Fixed manufacturing overhead } & 145,000 \\\hline \text { Net loss } & \$ \$ 55,000 ) \\\hline\end{array}$$ Clemson Company is trying to determine whether or not to discontinue the manufacture and sale of Tams. The operating results reported above for last year are expected to continue in the foreseeable future if the product is not dropped. The fixed manufacturing overhead represents the costs of production facilities and equipment that the Tam product shares with other products produced by Clemson. If the Tam product were dropped, there would be no change in the fixed manufacturing costs of the company.
-Assume that discontinuing the manufacture and sale of Tams will have no effect on the sale of other product lines. should be:

• A)$70,000 increase.
• B)$65,000 decrease.
• C)$90,000 decrease.
• D)$55,000 decrease.

Apply the midpoint formula to calculate elasticity.

Interpret the significance of elasticity values in economic decision-making.

Understand the relationship between Maslow's hierarchy of needs and other motivational theories like McClelland's theory of needs.

Compare and analyze different theories of motivation including Maslow's, McClelland's, and self-determination theory.

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Definitions:

Lower Dose

A reduced quantity or concentration of a substance, typically medication, administered or consumed, intending to minimize risk or side effects while maintaining effectiveness.

Diet Pills

Supplements intended to help with weight loss by suppressing appetite, increasing metabolism, or blocking fat absorption.

Amphetamines

A class of stimulant drugs that can increase energy and concentration but also carry the risk of addiction and adverse health effects.

Morphine

A highly addictive substance derived from opium that is particularly effective in relieving pain.