Based on the Decision Tree, Which of the Following Choices

question 57

Multiple Choice

Based on the decision tree, which of the following choices describes the final decision for this company?

• A)Do not conduct the survey and choose to build a large facility.
• B)Conduct the survey and choose to build a large facility regardless of the survey results.
• C)Conduct the survey and choose to build a large facility if the survey results are strong and choose to build a small facility if the survey results are weak.
• D)Do not conduct the survey and choose to build a small facility.

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Definitions:

Gross Profit

The difference between sales revenue and the cost of goods sold before deducting operating expenses, interest, and taxes.

Overall Profitability

An assessment of a company's ability to generate earnings as compared to its expenses and other relevant costs incurred during a specific period of time.

Company

A legal entity formed by a group of individuals to engage in and operate a business—commercial or industrial—enterprise.

Perpetual Inventory System

An inventory accounting technique that instantly logs the sale or acquisition of inventory using computerized point-of-sale systems and enterprise asset management software.