John Is Familiar with a Perceptual Error Known as the Recency

question 110

Multiple Choice

John is familiar with a perceptual error known as the recency effect. How might John incorporate this knowledge into his performance evaluation with his boss?

• A) He can start strong in the early part of the review period and then let his performance diminish as the evaluation comes nearer.
• B) He can focus on performing well in the time just prior to the performance evaluation as that is what his boss is most likely to remember.
• C) The recency effect would not apply to performance evaluations.
• D) He can maintain average performance throughout and be seen as a steady worker.

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Definitions:

Absorption Costing

A method of costing that includes all manufacturing costs, both fixed and variable, in the cost of a product.

Cost-plus Pricing

A pricing strategy where the selling price is determined by adding a specific markup to a product's cost price.

Return on Investment

A measure used to evaluate the efficiency of an investment, calculated as net profit divided by the cost of the investment.

Markup

The increment added to the acquisition cost of products to address company overheads and earn profit.