_____ Approach Describes How Managers Actually Make Decisions, Where as _____

question 160

Multiple Choice

_____ approach describes how managers actually make decisions, where as _____ approach defines how a decision-maker should make decisions.

• A) Normative; descriptive
• B) Normative; classical
• C) Descriptive; normative
• D) Descriptive; administrative
• E) Normative; administrative

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Definitions:

GAAP

Generally Accepted Accounting Principles, a collection of commonly-followed accounting rules and standards for financial reporting.

CVP Analysis

A management accounting method used to analyze the impact of varying levels of costs and volume on operating profit.

Fixed Cost

Expenses that do not change with the volume of production or sales, such as rent, salaries, and insurance premiums.

Activity Level

The activity level is a measure of volume of work or operations, which could influence costs and operational efficiency within a business.