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AHIP Exam AHM-520 Topic 5 Question 85 Discussion

Actual exam question for AHIP's AHM-520 exam

Question #: 85
Topic #: 5

[All AHM-520 Questions]

In order to achieve its goal of improved customer service, the Evergreen Health Plan will add three new customer service representatives to its existing staff, install a new switching station, and install additional phone lines. In this situation, the cost that would be classified as a sunk cost, rather than a differential cost, is the expense associated with:

AAdding new customer service representatives

BMaintaining the existing staff

CInstalling a new switching station

DInstalling additional phone lines

Show Suggested Answer

Suggested Answer: B

by Willard at Apr 23, 2024, 03:06 AM

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Dominga

6 months ago

I think installing additional phone lines is the sunk cost, as it is a cost that has already been incurred and cannot be changed regardless of the decision to add new staff or a switching station.

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Ezekiel

6 months ago

I can see your perspective but my rationale is based on the fact that maintaining the existing staff is a cost that cannot be recovered.

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Lenna

6 months ago

Interesting point but I still think adding new customer service representatives is the sunk cost.

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Tresa

7 months ago

I see where you're coming from but I think installing a new switching station would be the sunk cost.

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Ezekiel

7 months ago

I disagree, I believe maintaining the existing staff would be the sunk cost in this scenario.

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Lenna

7 months ago

I think the sunk cost would be adding new customer service representatives.

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Lenita

8 months ago

That would also be classified as a differential cost since it's a new addition for improved service.

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Melvin

8 months ago

What about the cost of installing the new switching station?

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Tamekia

8 months ago

So that means the cost of maintaining the existing staff would be a differential cost.

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Jesus

8 months ago

The sunk cost would be the expense associated with adding new customer service representatives.

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