According to the Authority-Acceptance Theory, Whether a Directive Has Authority

question 23

True/False

According to the authority-acceptance theory, whether a directive has authority or not is determined by the person in authority.

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Definitions:

Variable Cost

Costs that vary directly with the level of production or sales, such as materials and labor.

Rate of Return

The profit or deficit incurred on an investment during a certain period, shown as a percentage of the original investment amount.

Target Cost

The maximum amount that can be spent on a product to ensure a desired profit margin is achieved.

Market Dictated Price

The price of a good or service as determined by the supply and demand dynamics in the open market.