Figure 12-3Grey Inc Centra Has Capacity to Make 700,000 Boxes Per Year

question 94

Multiple Choice

Figure 12-3Grey Inc. has many divisions that are evaluated on the basis of ROI. One division, Centra, makes boxes. A second division, Mantra, makes chocolates and needs 80,000 boxes per year. Centra incurs the following costs for one box:
$\begin{array}{ll}\text { Direct materials } & \$ 0.35 \\\text { Direct labor } & \$ 0.60 \\\text { Variable overhead } & \$ 0.40 \\\text { Fixed overhead } & \$ 0.13 \\\text { Total } & \$ 1.48\end{array}$ Centra has capacity to make 700,000 boxes per year. Mantra currently buys its boxes from an outside supplier for $1.80 each (the same price that Centra receives) .
-Refer to Figure 12-3. Assume that Grey Inc. allows division managers to negotiate transfer price. Centra is producing 600,000 boxes. If Centra and Mantra agree to transfer boxes, what is the floor of the bargaining range and which division sets it?

• A) $1.80; Centra
• B) $1.48; Centra
• C) $1.48; Mantra
• D) $1.35; Mantra
• E) $1.35; Centra

Understand the constitutional grounds for and against federal regulation of private businesses.

Identify the limitations of the First Amendment concerning free speech and commercial speech.

Recognize the principles governing the protection of individual privacy under the U.S. Constitution.

Distinguish between the different types of speech protected under the First Amendment.

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Definitions:

Reinforced

Strengthened or encouraged to occur again in the future, typically through a reward or positive outcome following a specific behavior.

Conditioned Stimulus

A previously neutral stimulus that, after association with an unconditioned stimulus, comes to trigger a conditioned response.

Unconditioned Stimulus

In classical conditioning, an initially neutral stimulus that automatically triggers a reflexive response without any need for prior learning.

Classical Conditioning

A teaching process in which two stimuli are repeatedly linked; a response that is initially prompted by the second stimulus becomes prompted by only the first stimulus over time.