To Evaluate the Potential Impact of Changes to Its SUV

question 63

Multiple Choice

To evaluate the potential impact of changes to its SUV business, Ford Motor Company would use:

• A) normative economic analysis.
• B) positive economic analysis.
• C) negative economic analysis.
• D) arbitrage analysis.

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Definitions:

CEO

Chief Executive Officer, the highest-ranking person in a company or organization, responsible for overall management.

Sales Budget

One of the major elements of the income statement budget that indicates the quantity of estimated sales and the expected unit selling price.

Production Budget

A budget of estimated units to be manufactured to meet budgeted sales and desired inventory levels.

Capital Expenditures Budget

A plan for a company’s spending on fixed assets, such as equipment or property, that will be used over a long period.