When We Must Make a Choice, Our _____ Regarding Various

question 235

Multiple Choice

When we must make a choice, our _____ regarding various alternatives can determine what intuitively may seem to be the right answer.

• A)knowledge of the base rate
• B)divergent thinking
• C)deductive reasoning
• D)emotional reactions

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Definitions:

Fixed Cost

A fixed cost is an expense that does not change with the level of goods or services produced by a business, such as lease payments or insurance premiums.

Sunk Cost

A sunk cost is a past expense that has already been incurred and cannot be recovered. Businesses cannot alter these costs with future decisions.

Uncontrollable Cost

Expenses that cannot be changed or influenced by the actions of a particular department or manager.

Incremental Cost

The additional cost associated with producing one more unit of a product or service.