BP and Halliburton executives made the decision not to invest in the oil well blowout preventer that experts believe would have prevented the Deepwater Horizon oil rig explosion and fire off the coast of Louisiana. The executives made their decision based on their belief that their decision would have no great negative consequences. Their decision is an example of
A. satisficing.
B. panic.
C. the curse of knowledge.
D. relaxed avoidance.
E. relaxed change.
D. relaxed avoidance.
In relaxed avoidance, a manager decides to take no action in the belief that there will be no great negative consequences.
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Columbia Manufacturing Corp purchased a new lathe machine for its baseball bat manufacturing plant on January 1 . The machine cost $12,000 and is expected to be used in production for 4 years at which time its estimated salvage value will be $2,000 . The yearly straight-line depreciation for this asset would be
a. $2,500 b. $3,000 c. $4,000 d. $12,000 e. $9,500
Identify some of the causes of poor listening
A typical objective of an operational audit is for the auditor to
A. Determine whether the financial statements present fairly the entity's operations. B. Evaluate the feasibility of attaining the entity's operational objectives. C. Make recommendations for improving performance. D. Report on the entity's relative success in attaining profit maximization.
On January 1, a company issues bonds dated January 1 with a par value of $300,000. The bonds mature in 5 years. The contract rate is 9%, and interest is paid semiannually on June 30 and December 31. The market rate is 8% and the bonds are sold for $312,177. The journal entry to record the issuance of the bond is:
A. Debit Cash $300,000; debit Premium on Bonds Payable $12,177; credit Bonds Payable $312,177. B. Debit Cash $312,177; credit Premium on Bonds Payable $12,177; credit Bonds Payable $300,000. C. Debit Cash $312,177; credit Discount on Bonds Payable $12,177; credit Bonds Payable $300,000. D. Debit Bonds Payable $300,000; debit Bond Interest Expense $12,177; credit Cash $312,177. E. Debit Cash $312,177; credit Bonds Payable $312,177.