Which of the Following Is NOT a Reason for Average

question 155

Multiple Choice

Which of the following is NOT a reason for average costs to fall according to the learning curve?

• A) Workers accomplish tasks more quickly after doing the task a few times.
• B) Managers schedule more efficiently over time.
• C) Engineers determine more accurately what tolerances can be used.
• D) Suppliers may become better able to produce the exact inputs the firm needs.
• E) Competing firms leave the industry as the learning firm becomes more efficient.

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Definitions:

Indirect Costs

Costs that are not directly traceable to a specific project, product, or activity, typically including overheads like administration and utilities.

Research and Development

Activities undertaken by a business to develop new products or processes, or to improve existing ones, typically involving innovation and technological advancements.

Preproduction Prototypes

Early versions of a product made prior to full-scale production, used for testing and validation.

Capitalized

Costs that are added to the cost basis of an asset on the balance sheet rather than being expensed immediately.