The Management of Acrosonic Is Faced with the Problem of Deciding

question 94

Multiple Choice

The management of Acrosonic is faced with the problem of deciding whether to expand the production of its line of electrostatic loudspeaker systems. It has been estimated that an expansion will result in an annual profit of $200,000 for Acrosonic if the general economic climate is good. On the other hand, an expansion during a period of economic recession will cut its annual profit to $100,000. As an alternative, Acrosonic may hold the production of its electrostatic loudspeaker systems at the current level and expand its line of conventional loudspeaker systems. In this event, the company is expected to make a profit of $40,000 in an expanding economy (because many potential customers will be expected to buy electrostatic loudspeaker systems from other competitors) and a profit of $170,000 in a recessionary economy. ​
Should management recommend expanding the company's line of electrostatic loudspeaker systems?​
Hint: The row player is the management of the company and the column player is the economy.

• A) yes
• B) no
• ​

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Definitions:

Placebo Effect

A beneficial health outcome resulting from a person's expectations of treatment rather than the treatment itself, highlighting the power of the mind.

Virtual Reality Exposure Therapy

Virtual reality exposure therapy is a treatment technique using realistic simulations in VR to expose patients to the sources of their phobias or anxiety in a controlled manner to help them overcome their fears.

Unwanted Behavior

Actions or conduct deemed inappropriate, undesirable, or unacceptable by societal or individual standards.

Aversive Conditioning

A type of behavioral learning in which an unpleasant or harmful stimulus is associated with a particular behavior to decrease the likelihood of that behavior occurring.