If a Special Order Results in a Positive Contribution Margin

question 15

Multiple Choice

If a special order results in a positive contribution margin of $8 when the contribution margin for regular orders is $15,which of the following decisions is the most likely to be chosen?

• A)Accept the order
• B)Reject the order
• C)Accept the order,but only if the customer agrees to an increase in the selling price to match the $15 regular contribution margin.
• D)Accept the order,but only if the customer agrees to an increase of $7 in the selling price

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Definitions:

Situational Leadership Model

A leadership theory that proposes the effectiveness of leadership styles varies depending on the readiness and behavior of the people being led and the specifics of the situation.

Telling Style

A communication approach characterized by explicitly instructing or directing others in what they should do.

Task Behavior

A leadership style characterized by clear explanations of tasks, directions, and expectations to ensure that goals are understood and accomplished.

Transactional Leaders

Leaders who focus on routine transactions, using rewards and punishments to motivate followers.