McAlister Company Is Operating at Capacity and Desires to Add

question 67

Multiple Choice

McAlister Company is operating at capacity and desires to add a new service to its rapidly expanding business. The service should be added as long as service revenues exceed:

• A) variable costs.
• B) fixed costs.
• C) the sum of variable costs and fixed costs.
• D) the sum of variable costs and any related opportunity costs.
• E) the sum of variable costs, fixed costs, and any related opportunity costs.

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Definitions:

ERG Theory

A motivational theory proposed by Clayton Alderfer that categorizes human needs into existence, relatedness, and growth categories.

Satisfied Needs

The condition of having one's basic or specific desires fulfilled or met.

Motivational Impact

The effect of different factors on an individual's drive or incentive to perform tasks and goals.

Physiological Desire

A fundamental need stemming from the body's biological functions, such as hunger, thirst, or the need for sleep.