A Manager Should Always Reject a Special Order If

question 256

Multiple Choice

A manager should always reject a special order if

• A)the special order price is less than the variable costs of the order.
• B)there is available excess capacity.
• C)the special order price is less than the regular sales price.
• D)the special order will require variable nonmanufacturing expenses.

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Definitions:

Price Ceiling

A government-imposed limit on how high a price can be charged on a product or service, often meant to protect consumers.

Invisible Hand

A metaphor introduced by Adam Smith to describe how an individual's pursuit of self-interest can lead to good results for society as a whole through the workings of competitive markets.

Economic Well-Being

A measure of the economic quality of life that includes factors like income, employment, class disparity, and economic security.

Free Markets

Economic systems in which prices for goods and services are determined by the open market and consumers, with minimal government intervention.