Which of the Following Provides a Key in Analyzing Short-Term

question 86

Multiple Choice

Which of the following provides a key in analyzing short-term business decisions?

• A) focus on costs that do not change under two alternatives and on historic costs
• B) focus on qualitative data only and ignore future cash flows
• C) focus on sunk costs and quantitative data
• D) focus on relevant costs and use the contribution margin approach

Recognize the influence of uncertain and risk environments on managerial decisions.

Differentiate between classical and behavioral decision theories.

Understand the concept of bounded rationality in decision-making.

Recognize common mistakes in problem definition within the decision-making process.

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Definitions:

Effective Capacity

The maximum output rate or service capacity an operation, facility, or machine can achieve under normal conditions or constraints.

Process Cycle Time

The total time it takes to complete a series of tasks from start to finish in a process, often aimed at identifying efficiencies.

Service Sector

A segment of the economy that provides intangible goods and services to consumers, such as healthcare, education, and financial services.

Early Bird

An idiom referring to someone who starts their day early or arrives before the usual time, often used to indicate that such behavior yields advantage or benefit.