A Factory Is Operating at Less Than 100% Capacity

question 15

Multiple Choice

A factory is operating at less than 100% capacity.Potential additional business will not use up the remainder of the plant capacity.Given the following list of costs, which one should be ignored in a decision to produce additional units of product?

• A)variable selling expenses
• B)fixed factory overhead
• C)direct labour
• D)contribution margin of additional units

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Definitions:

Flow State

A mental state in which a person performing an activity is fully immersed in a feeling of energized focus, full involvement, and enjoyment in the process of the activity.

Involvement

The degree of personal relevance or interest that a consumer perceives in a product, service, or brand, affecting the intensity and depth of the decision-making process.

Motivation

Motivation is the internal drive or external stimulus that prompts individuals to act or behave in a particular manner towards achieving a goal.

Consumer Involvement

Refers to the level of interest and personal relevance a consumer feels towards a particular product or service.