Which of the following is not a potential disadvantage of accepting a very small earnest money deposit?
A. The buyer will not be deterred from walking away from the sale if a better opportunity arises
B. The seller will have to do in order to recover a significant amount of money from the buyer in the event of default
C. The seller will not have a large deposit as consolation if the transaction fails
D. The buyer will lose money if he causes the transaction to fail
Answer: D. The buyer will lose money if he causes the transaction to fail
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Many firms feel a strong obligation to establish and use a standard rate for fixed factory overhead because:
a. The resulting data are useful for performance-evaluation purposes. b. Generally accepted accounting principles in the U.S. require full costing of inventories for financial reporting purposes. c. Larger income tax deductions result when fixed overhead costs are treated as product costs rather than period costs. d. None of the above—fixed overhead costs are typically expensed as period costs. e. This approach improves upon management's ability to more accurately forecast future overhead costs.
Which of the following is a criticism of the classical approaches to management as a whole?
A. The relationship between an organization and its external environment is ignored. B. Most managers are not trained to use these techniques. C. Many aspects of a management decision cannot be expressed through mathematical symbols and formulas. D. Many of the decisions managers face are nonroutine and unpredictable. E. There is only “one best way” to manage and organize because circumstances vary.