One needs to also consider capacity. A full-share of coststypically includes some allocation of fixed costs. However,if you are not running at capacity, it makes sense to accept anydeal that pays more than the variable costs incurred fromproduction. If later on, someone offers you a better deal,you can stop producing for this...
One needs to also consider capacity. A full-share of coststypically includes some allocation of fixed costs. However,if you are not running at capacity, it makes sense to accept anydeal that pays more than the variable costs incurred fromproduction. If later on, someone offers you a better deal,you can stop producing for this...
Principles Of Marketing
17th Edition
ISBN:9780134492513
Author:Kotler, Philip, Armstrong, Gary (gary M.)
Publisher:Kotler, Philip, Armstrong, Gary (gary M.)
Chapter1: Marketing: Creating Customer Value And Engagement
Section: Chapter Questions
Problem 1.1DQ
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One needs to also consider capacity. A full-share of coststypically includes some allocation of fixed costs. However,if you are not running at capacity, it makes sense to accept anydeal that pays more than the variable costs incurred fromproduction. If later on, someone offers you a better deal,you can stop producing for this...
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