The managers at movo automobile inc. want to diversify their business by acquiring a consumer electronics company. this acquisition would mean increased job security, higher compensation, and greater decision-making authority for the managers. the managers correlate this acquisition to greater power for them rather than to the appreciation in shareholder value. in this scenario, this acquisition by movo automobile ismost likely a result of:
a. time compression diseconomies.
b. experience-curve effects.
c. principal-agent problems.
d. resource ambiguity.

Solomon chemical company makes three products, b7, k6, and x9, which are joint products from the same materials. in a standard batch of 320,000 pounds of raw materials, the company generates 70,000 pounds of b7, 150,000 pounds of k6, and 100,000 pounds of x9. a standard batch costs $3,840,000 to produce. the sales prices per pound are $10, $14, and $20 for b7, k6, and x9, respectively. (a) allocate the joint product cost among the three final products using weight as the allocation base. (b) allocate the joint product cost among the three final products using market value as the allocation base. (c) allocate the joint product cost among the three final products using weight as the allocation base.