Which of the Following Is NOT a Necessary Condition for Classification

question 143

Multiple Choice

Which of the following is NOT a necessary condition for classification as a value-added activity?

• A)The activity produces no change of state.
• B)The change of state was not achievable by preceding activities.
• C)Activity enables other activities to be performed.
• D)All of these are necessary conditions.

---

Definitions:

Interest

The cost that creditors charge for use of their capital.

Moral Hazard

The risk that one party to an agreement can change their behavior to the detriment of another after the transaction has taken place, often due to asymmetrical information.

Bonded

indicates a state of being secured by a bond, involving a financial guarantee or protection against losses.

Shirking

The act of avoiding or neglecting responsibilities, especially in the workplace, leading to reduced productivity or performance.