Lottery Company Has Two Divisions, One Located in Vancouver and the Other

question 69

Multiple Choice

Lottery Company has two divisions, one located in Vancouver and the other located in Regina. Vancouver sells selected goods to Regina for use in various end products. Assuming that the transfer prices set by Vancouver do not influence the decisions made by the two divisions, which of the following correctly describes the impact of the transfer prices on divisional profits and overall company profit? $\begin{array}{|c|c|c|c|}\hline&\text { Vancouver Profit } & \text { Regina Profit } & \text { Lottery Company Profit } \\\hline1& \text { Affected } & \text { Affected } & \text { Affected } \\\hline 2&\text { Affected } & \text { Affected } & \text { Not affected } \\\hline 3&\text { Affected } & \text { Not affected } & \text { Affected } \\\hline 4&\text { Not affected } & \text { Not affected } & \text { Affected } \\\hline5& \text { Not affected } & \text { Not affected } & \text { Not affected }\\\hline\end{array}$

• A)1
• B)2
• C)3
• D)4
• E)5

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Definitions:

Bureaucratic Inefficiency

Bureaucratic inefficiency refers to the lack of effectiveness and productivity in government agencies or organizations, characterized by excessive red tape, slow processes, and unresponsiveness.

Social Structure

The ordered and patterned relationships between and among different statuses and groups in a society, which influence people's choices, behaviors, and opportunities.

Rivalries

Competitive or adversarial relationships, often characterized by ongoing opposition or conflict between parties.

Social Groups

These are collections of individuals who interact with each other and share similar characteristics and a sense of unity.