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Roshini
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Joined: 25 Dec 2008
Location: United States
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| Posted: 28 Aug 2009 at 19:09 | IP Logged
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I was going thro becker-2
I had this sentence (quoted below) as an answer choice
in two different questions in two different ways and i
didn't understand what it means.
" The costs of exciting the market are less than (exceed
instead of less than in another question's answer
choice) the costs of continuing to operate" - mcq CPA -
04068
can someone explain what this sentence really means ?
__________________
AUD 04-03-09 87 Passed
FAR 08-07-09 78 Passed
BEC 10-09-09 91 Passed
REG 11-30-09 82 Passed
I am a M.com,Grad CWA from india now residing at new jersey
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annoyings
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| Posted: 28 Aug 2009 at 19:33 | IP Logged
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Let's say you are operating a business at a monthly loss of $100 and you
have a 12 month lease which you will have to pay $1,500 to terminate early.
Staying in business for 12 more months will result in a loss of $1,200 and
terminating business immediately will result in a loss of $1,500. Thus, the
costs of exiting (not exciting) the business exceed the costs of continuing to
operate.
Hope this helps clear up the concept.
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Roshini
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Posts: 89
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| Posted: 29 Aug 2009 at 08:52 | IP Logged
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Hey now i got it.
I don't know why i was reading it as exciting (cause of
confusion) even though it is correctly mentioned as exiting
in becker.
Thanks for clarifying.
__________________
AUD 04-03-09 87 Passed
FAR 08-07-09 78 Passed
BEC 10-09-09 91 Passed
REG 11-30-09 82 Passed
I am a M.com,Grad CWA from india now residing at new jersey
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Topic: What does this mean
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