This Question Is to Be Considered Independently of All Other

question 71

Multiple Choice

This question is to be considered independently of all other questions relating to Laro Corporation. Refer to the original data when answering this question. Management is considering using a new component that would increase the unit variable cost by $7. Since the new component would increase the features of the company's product, the marketing manager predicts that monthly sales would increase by 500 units. What should be the overall effect on the company's monthly net operating income of this change?

• A)increase of $1,000
• B)decrease of $1,000
• C)increase of $34,000
• D)decrease of $34,000

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Definitions:

Liaison Personnel

Individuals or staff members responsible for managing communication and coordination between different departments or organizations.

Authoritative Command

A form of leadership where orders are given with authority, often without question or input from subordinates.

Avoidance

A behavioral or cognitive strategy aimed at preventing unpleasant emotions, confrontation, or failure by staying away from certain tasks, situations, or interactions.

Authoritative Command

A leadership style characterized by making decisions alone and expecting subordinates to follow instructions without question.