(Appendix 11A) Wetherald Products, Inc

question 100

Multiple Choice

(Appendix 11A) Wetherald Products, Inc., has a Pump Division that manufactures and sells a number of products, including a standard pump that could be used by another division in the company, the Pool Products Division, in one of its products. Data concerning that pump appear below:
The Pool Products Division is currently purchasing 4,000 of these pumps per year from an overseas supplier at a cost of $74 per pump.
-Assume that the Pump Division is selling all of the pumps it can produce to outside customers.What should be the minimum acceptable transfer price for the pumps from the standpoint of the Pump Division?

• A) $64 per unit
• B) $74 per unit
• C) $82 per unit
• D) $53 per unit

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Definitions:

Higher-Order Conditioning

A process in classical conditioning in which a conditioned stimulus is paired with a new neutral stimulus, creating a second (often weaker) conditioned response.

Generalization

The process by which an animal or a person responds to a new stimulus in a way that's similar to how they responded to a previously encountered stimulus.

Operant Conditioning

An approach to education that utilizes incentives and penalties to shape behavior.

Conditioned Taste Aversions

A learned response where an individual avoids a food after a negative experience, demonstrating how tastes become associated with illness or discomfort.