One Way Service Businesses Communicate a Higher Level of Service

question 137

Multiple Choice

One way service businesses communicate a higher level of service quality to their customers is by having their employees be clean, sharp looking, and dressed in appropriate uniforms. This is a way to address the ____ characteristic of services.

• A) intangibility
• B) perishability
• C) tangibility
• D) inseparability
• E) heterogeneity

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Definitions:

Effective-interest Method

A technique used in finance to calculate the actual interest rate on a bond or loan, taking into account the effect of compounding over the period.

Interest Expense

The cost incurred by an entity for borrowed funds; it is a non-operating expense shown on the income statement.

Straight-line Amortization

A method of reducing the carrying amount of an intangible asset over a fixed period of time in a systematic and rational manner.

Premium Amortization

The gradual expense or reduction of the premium paid above the par value of a debt security over its remaining term.