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Decision Making Process and Information – MCQs
35 questions. Click to practice.
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Correct options are highlighted when revealed.
1.
How is the expense of purchasing a new machine classified?
Relevant cost
Nonsense
Salvage value
Irrecoverable cost
2.
What term describes the practice of purchasing goods or services from foreign suppliers rather than domestic ones?
outsourcing
insourcing
idle sourcing
sunk sourcing
none of the above
3.
Within the context of relevance concepts, what is another term used for relevant revenues?
corresponding revenues
unusual revenues
anticipated future revenues
consecutive revenues
4.
Which type of costs are irrecoverable and remain constant regardless of any actions taken?
sunk costs
bunked costs
unrecorded costs
recorded costs
5.
What term describes the extra cost incurred when performing a specific activity?
incremental cost
differential cost
dependent cost
independent cost
6.
What is the second stage in the decision-making process?
analyzing multi-collinearity data
gathering quantitative data
conducting qualitative evaluation
collecting necessary information
7.
Which category describes outcomes that are expressed using numerical values?
non-numerical attributes
numerical variables
anticipated elements
documented variables
8.
How is the cost, like the $6000 salvage value of an old machine, categorized?
not applicable
depreciated amount
residual value
relevant cost
sunk cost
9.
What term describes the choices a company makes regarding which products to produce and sell, as well as the quantities across multiple product lines?
marginal decisions
contracting out decisions
product assortment decisions
internal sourcing decisions
capacity planning decisions
10.
What is the structured approach called that involves making decisions using both quantitative and qualitative evaluations?
numerical evaluation
decision method
subjective analysis
linear approach
statistical technique
11.
Which of the following is an example of a qualitative factor?
employee satisfaction
material expenses
labor wages
advertising costs
12.
What is the term for the cost difference that arises when comparing different alternatives?
contingent cost
fixed cost
additional cost
differential cost
sunk cost
13.
Which type of financial factors are expressed in numerical form and have a specific monetary value?
non-numeric factors
quantitative factors
anticipated factors
documented factors
none of the above
14.
Which of the following is an example of a quantitative factor?
Workplace employee conduct
Level of employee contentment
Employee enthusiasm
Expense of raw materials
15.
What type of decision involves choosing between producing internally or purchasing from an external supplier?
decisions related to demand or supply
make or buy decisions
decisions that are relevant or irrelevant
decisions about idle time or workload
16.
What is the third stage in the decision-making process?
linear forecasting
dependent forecasting
forecasting outcomes
independent forecasting
17.
What term is used to describe costs that have already been incurred and cannot be recovered?
unaccounted expenses
documented costs
sunk costs
forfeited expenses
18.
What term describes the cost incurred when funds are tied up in unused inventory instead of being invested elsewhere?
expenses related to foreign operations
costs associated with subcontracting work
expenses from internal resource use
the cost of missed alternative investments
19.
Within general classifications, decision outcomes are grouped into which of the following categories?
irrecoverable costs
measurable elements
non-measurable elements
a combination of measurable and non-measurable elements
none of the above
20.
What is the initial step in the decision-making process?
Recognize the problem
Determine the linear variable
Establish the certainty
Identify the multiplier
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