Bob Neal and Jon Smelky Own a Large Cabinet-Making Company

question 15

Multiple Choice

Bob Neal and Jon Smelky own a large cabinet-making company in Alabama.Their CPA advised them that they needed to develop another source of income as well as increase the efficiency of the organization if they wanted to continue making a profit.Neal's wife overheard this conversation and suggested the men do something with the wood wastes that the cabinet-making process produces.Shortly after Neal attended a trade show where he learned that the company's discarded wood slabs could be used to build wooden pallets.The company would need to invest about $45,000 as startup costs.Meanwhile,Smelky investigated the possibility of turning their wood scraps into mulch and selling it to a gardening supply wholesaler.Costs for this project were estimated at about $33,000.Neal and Smelky met with their three crew supervisors to see which method they should adopt.The crew supervisors voted for pallet making.Neal and Smelky began looking for a supplier.
-What role did the three crew supervisors play in the decision to buy pallet-making equipment?

• A)Gatekeeper,influencer and decider
• B)User,influencer,gatekeeper and initiator
• C)Decider,influencer and buyer
• D)User and influencer
• E)Buyer,user,decider and influencer

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Definitions:

Treasury Bill

A short-term government security issued at a discount from the face value and pays no interest before maturing at its face value.

Effective Annual Rate

The interest rate on a loan or investment, adjusted for the effect of compounding over a one-year period.

Par

The face value of a bond or other financial instrument, which is the amount to be paid to the holder at maturity.

HPR

Holding Period Return, a measure of the total return received from holding an asset or portfolio of assets over a specified period of time.