In a Proposal to Increase the Production of Clock Radios,the

question 18

Multiple Choice

In a proposal to increase the production of clock radios,the sales managers of Rinaldo Electronics reported the total additional cost required to meet the increased production level.The increase in total cost is known as the

• A)opportunity cost.
• B)sunk cost.
• C)uncontrollable cost.
• D)differential cost.

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Definitions:

Escape Liability

A legal strategy or circumstance that allows an individual or entity to avoid responsibility for an action or outcome.

Limited Liability

Status that specifies that an individual’s liability will not go beyond his or her original investment.

Personally Liable

The responsibility of an individual to pay a debt or fulfill an obligation from their own assets, not just the assets of a business or an entity they represent.

Capital Investment

Funds invested in a business venture with the expectation of generating income or profit.