When Fixed Costs Are Ignored Because They Are Irrelevant to a Business's

question 78

Multiple Choice

When fixed costs are ignored because they are irrelevant to a business's production decision,what are they called

• A)explicit costs
• B)implicit costs
• C)sunk costs
• D)opportunity costs

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Definitions:

Macro-Environment

The macro-environment encompasses the broad external conditions that affect businesses and industries, including economic, social, technological, and political factors.

Premise Control

The process of managing and regulating the physical environment of a business location to ensure safety, compliance, and comfort.

Liquidity Ratio

A financial measure used to determine a company's ability to cover its short-term obligations with its most liquid assets.

Financial Obligations

Commitments to pay money to another party, including debts, salaries, taxes, and other liabilities.