Dave Is an Owner and Manager of Three Apartment Buildings

question 122

Multiple Choice

Dave is an owner and manager of three apartment buildings in northern Minnesota.During an exceptionally hot summer the temperatures soared and the toll on the window air conditioners was too much.Seventeen of them have broken down already,and more are probably going to have to be replaced.He has a total of seventy-five apartment units.Dave is now in the process of deciding how to repair the air conditioning.Should he buy new window units for all the buildings,or should he install central air conditioning? What type of decision is Dave facing?

• A)situational involvement and extended problem solving
• B)situational involvement and limited problem solving
• C)enduring involvement and extended problem solving
• D)enduring involvement and limited problem solving
• E)external involvement and limited problem solving

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Definitions:

Perfectly Competitive

A market structure characterized by many buyers and sellers, all of whom are price takers with the product being homogeneous.

Sunk Costs

Expenses that have already been incurred and cannot be recovered, which should not influence future business decisions.

Dairy Farmer

A dairy farmer is an individual engaged in the management and care of cows for the production of milk and other dairy products.

Accounting Profits

The difference between total revenue and explicit costs of a business, calculated according to standard accounting practices.