Escalation of Commitment Refers to ________

question 27

Multiple Choice

Escalation of commitment refers to ________.

• A) commitment to a faulty decision due to an unwillingness to go against the opinion of the majority
• B) an increased commitment to a previous decision despite evidence that it may have been wrong
• C) the strengthening of commitment to a particular course of action due to greater motivation by others
• D) greater commitment to a decision because of ones belief that it is "the right thing to do"

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Definitions:

Fair Value Measurement

This is the estimation of the price at which an asset or liability could be exchanged in a current transaction between willing parties, other than in a liquidation sale.

Financial Instruments

Contracts that give rise to a financial asset of one entity and a financial liability or equity instrument of another entity.

FASB

The Financial Accounting Standards Board, an organization responsible for setting and improving financial accounting and reporting standards in the U.S.

IASB

The International Accounting Standards Board, responsible for developing and enforcing the International Financial Reporting Standards (IFRS).