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- Which of the following is a disadvantage of outsourcing? A. freeing up capacity B. freeing up capital C. transferring production and technology risks D. limiting ability to upsize or downsize productionFirms may incur higherfixed-costs, by investing in capital assets in order to reduce: Multiple Choice equipment costs. plant size. cash payment. variable costs.Compared to companies that have a cost structure that is mainly comprised of variable costs, companies with a cost :structure that is mainly comprised of fixed costs would Have limited ability to enhance their profits at a higher degree a O Have low operating leverage b O Be less vulnerable to adverse effects of economic downturn cO Be considered more risky .d O
- Compared to companies that have a cost structure that is mainly comprised of fixed costs, companies with a cost structure that is mainly comprised of variable costs would: O a. Be vulnerable to adverse effects of economic downturn O b. Have low operating leverage Oc. Be able to enhance their profits at a higher degree on O d. Be considered more riskyi.“Differential Costs” are considered as relevant, where as “sunk Cost ” is considered asirrelevant for decision making purposes. Explain ii. Why opportunity cost is measured and relate with the evaluation of alternative, can it bean opportunity loss? iii. Which one either spoiled goods or defective goods are less economical for the companyand why?Which of these costs is considered as the most important cost because if it is not met, an enterprise may fail to materialize.a. All of theseb. Increment costc. Fixed costd. First cost
- What concept relates to the proportionate savings in costs gained when levels of production are increased: A) Accounting profit. B) Economies of scale. C) Marginal costs. D) Barriers to entry. E) Economic profit. The benefit lost when choosing one option precludes receiving the benefits from an alternative option was referred to as: A) Irrelevant costs. B) Lost costs. C) Alternative costs. D) Opportunity costs. E) Sunk costs.Why might managers resist buying a more expensive piece of equipment, known to have a lower TCO, than a less expensive item?Which of the following is a disadvantage of outsourcing? Group of answer choices A. freeing up capacity B. freeing up capital C. transferring production and technology risks D. limiting ability to upsize or downsize production
- Over-applied FOH will result if: a. FOH costs incurred is less than FOH costs charged to production b. FOH costs incurred is greater than estimated FOH costs c. FOH costs incurred is greater than FOH costs charged to production d. The plant is operating at less than expected capacity.A decrease in the sales of a current project because of the launching of a new project is A. irrelevant to the investment decision. B. an overhead expense. C. a sunk cost. OD. cannibalization.Which of the following statements is true of information costs? a. The relatively large size of the FI allows it to collect information at a higher average cost than would be the case for individuals. b. The relatively large size of the FI allows it to collect information at a lower average cos than would be the case for individuals. c. Information costs are irrelevant to a large FI. d. Information costs are irrelevant to an individual.
