Which of the Following Is Not True About Residual Income

question 29

Multiple Choice

Which of the following is not true about residual income (RI) ?

• A)Influenced by size.
• B)Managers maximize an absolute amount.
• C)Managers maximize percentages.
• D)Stakeholders want residual income to achieve goal congruence.
• E)Managers evaluated on residual income choose new project only if residual income is positive.

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Definitions:

Forms Of Value

refer to the various ways in which goods, services, or actions can be valuable to consumers, including functional, emotional, social, and cultural aspects.

Mental Fixedness

The cognitive bias that limits a person to using an object only in the way it is traditionally used, hindering creativity and problem-solving.

Creative Insights

The ability to come up with new and unique ideas through understanding patterns or connections that are not obvious.

Habit-Breaking Strategies

Actions that involve techniques that help to break our minds out of mental fixedness in order to bring about creative insights.