Which of the Following Statements Describes a Scenario When Management

question 147

Multiple Choice

Which of the following statements describes a scenario when management should consider dropping a business division?

• A) The division has consistently reported an operating loss.
• B) The division's avoidable fixed costs are less than its contribution margin.
• C) The division's avoidable fixed costs are greater than its contribution margin.
• D) The division's unavoidable fixed costs are greater than its operating loss.

---

Definitions:

Nurture

The process of caring for and encouraging the growth or development of someone or something.

Helmholtz

Hermann von Helmholtz was a German physician and physicist known for his contributions to the understanding of the conservation of energy, mechanics, thermodynamics, and electrodynamics.

Visual Distortion

A perception anomaly where what one sees differs from the objective reality, often caused by optical illusions or certain psychological conditions.

Compensation

The process or mechanism with which individuals achieve reward, recognition, or alleviation of deficits or challenges, often applied in vocational and psychological contexts.