Double-Loop Feedback Occurs Under What Conditions

question 107

Multiple Choice

Double-loop feedback occurs under what conditions?

• A) When managers receive information about both the effectiveness of strategy implementation as well as the validity of assumptions.
• B) When managers receive feedback information from two information sources.
• C) When managers validate the feedback information by double checking it.
• D) When managers receive information about the effectiveness of the controls and the effectiveness of the implementation.

Comprehend the relationship between variable costs, fixed costs, and the contribution margin.

Understand the differences between different types of costs (variable, fixed, marginal, and incremental).

Grasp the concepts of financial, accounting, and cash break-even points.

Understand the importance and methodology of scenario and sensitivity analysis in project management.

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Definitions:

Fixed Component

A portion of costs within a business that remains constant, regardless of the level of production or business activity.

Overapplied

typically refers to when overhead costs allocated to products exceed the actual overhead costs incurred, leading to a variance in cost accounting.

Budget Variance

The difference between budgeted amounts and actual amounts spent or earned, used to assess financial performance against projections.

Volume Variance

A difference between actual and budgeted sales or production volumes, impacting costs and profitability.