Health Clubs Typically Experience an Increase in One-Year Memberships in January

question 199

Multiple Choice

Health clubs typically experience an increase in one-year memberships in January, but many new customers cancel their memberships before the end of the year.Which of the following is the best explanation for this behavior?

• A)Some health club members suffer minor injuries that prevent them from working out.
• B)Some people are overly optimistic about their future behavior.
• C)Some people fail to treat their membership fees as sunk costs.
• D)Some members receive utility from activities they believe are popular.

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Definitions:

Support Department Cost

Expenses related to departments within a company that do not directly produce goods but support those that do.

Support Department Allocations

The process of distributing overhead costs from service departments to direct production areas, often based on specific allocation bases.

Operating Income

Income generated from the normal business operations of a company, excluding expenses from interest and taxes.

Return on Investment

A performance measure used to evaluate the efficiency or profitability of an investment.