Question
Question 25 of 33 Which of the following businesses is demonstrating a loss? A. Company C, where the government is intervening to prevent fraud B. Company A, where the cost of production is greater than the selling price C. Company B, where there is conflict between the workers and the management D. Company D, where there is a greater demand for a product than can be met
Answer
4.4
(310 Votes)
Xavier
Elite · Tutor for 8 years
Answer
B. Company A, where the cost of production is greater than the selling price.
Explanation
## Step 1: Analyze each optionThe question is asking us to identify which business is experiencing a loss. 1. 'Company C, where the government is intervening to prevent fraud': This scenario does not necessarily indicate a loss. While government intervention could lead to penalties or fines, it does not directly imply that the company is operating at a loss.2. 'Company A, where the cost of production is greater than the selling price': This scenario is a clear indication of a loss. When the cost of producing a product or service exceeds the price at which it is sold, the company is operating at a loss.3. 'Company B, where there is conflict between the workers and the management': While conflict within a company can lead to decreased productivity and potential financial consequences, it does not directly imply that the company is operating at a loss.4. 'Company D, where there is a greater demand for a product than can be met': This scenario does not necessarily indicate a loss. While inability to meet demand could result in lost potential profits, it does not mean the company is operating at a loss.