A Company Expects Its Three Departments to Yield the Following

question 37

Multiple Choice

A company expects its three departments to yield the following income for next year.

Compute the change to the company's total net income if Dept. C is eliminated.

• A) $300 decrease.
• B) $300 increase.
• C) $2,800 decrease.
• D) $2,800 increase.
• E) $6,800 decrease.

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Definitions:

Capital Goods

Long-lasting goods acquired by a business to produce goods or services, as opposed to being sold directly to consumers.

Productive Resources

Inputs used in the production of goods or services in order to make an economic profit. These include land, labor, capital, and entrepreneurship.

Consumer Goods

Products and services that are purchased or consumed by individuals or households for their direct satisfaction and needs.

Pollution Permits

Allowances provided by government authorities that enable the holder to emit a specific amount of pollutants into the environment.