A Company Is Considering Whether to Continue to Make a Product

question 30

Multiple Choice

A company is considering whether to continue to make a product itself, or whether to buy it from another company. If it stops making the product, it will sell its existing factory and fire the workers who now make the product. Which of the following is usually not a "relevant" factor in making this decision?

• A) The price per unit it would pay the other company
• B) The severance costs it will have to pay the employees when it fires them
• C) The original cost of the factory
• D) The cash that will be received when the old factory is sold

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Definitions:

Concern

A feeling of worry or interest in a situation or problem.

Joyfulness

A state of great happiness and pleasure.

Expressed Emotion

A measure of the family environment that is based on how family members speak about each other, indicating levels of criticism, hostility, and emotional involvement.

Delusional Thoughts

False beliefs held with strong conviction despite superior evidence to the contrary, often symptomatic of psychiatric disorders.