A Well-Designed, Activity-Based Cost System Helps Managers Make Better Decisions

question 94

Multiple Choice

A well-designed, activity-based cost system helps managers make better decisions because information derived from an ABC analysis ________.

• A) can be used to eliminate nonvalue-added activities
• B) is easy to analyze and interpret
• C) takes the choices and judgment challenges away from the managers
• D) emphasizes how managers can achieve higher sales

Understand the concept of expected value and how to calculate it.

Grasp the idea of risk and how it is quantified in economic decisions.

Learn the difference between objective and subjective probabilities.

Analyze investment opportunities based on past performance data.

---

Definitions:

Internal Forces

Psychological or emotional factors that influence an individual's behavior and decision-making process from within.

External Forces

Factors or influences originating outside an individual that can impact their behavior, decisions, or psychological state.

Systematic Desensitization

A therapeutic technique aimed at reducing anxiety and fear responses by gradually exposing the individual to the feared object or context while teaching relaxation strategies.

Pathological Fear

An intense, irrational fear of a specific object, situation, or activity that is disproportionate to the actual threat or danger it poses.