Reactive Devaluation

question 18

Multiple Choice

Reactive devaluation

• A) leads negotiators to minimize the magnitude of a concession made by a disliked other.
• B) leads to reduced willingness to respond with a concession of equal size.
• C) may be minimized by maintaining a more objective view of the process.
• D) can lead to motivation to seek even more once a concession has been made.
• E) All of the above are elements of reactive devaluation.

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Definitions:

FIFO Method

An inventory valuation method that assumes the first items placed in inventory are the first sold, standing for "First In, First Out."

Equivalent Units

A concept in cost accounting used to allocate costs to partially completed goods, expressing the amount of work done in terms of fully completed units.

Work in Process Inventory

Stocks of unfinished goods in the production process at a specific point in time. These goods will be transformed into finished goods ready for sale.

Weighted-Average Method

An inventory costing method that assigns an average cost to each unit on hand, calculated by dividing total cost of goods available for sale by total units available.