The Controversy Surrounding External Versus Internal Growth Finds

question 52

Multiple Choice

The controversy surrounding external versus internal growth finds

• A) external growth appears to be superior financially to internal growth.
• B) internal growth appears to be superior financially to external growth.
• C) there appears to be no financial advantage to either.
• D) acquisitions have a lower survival rate than new internally generated business ventures.
• E) strategic alliances are superior to both.

---

Definitions:

Markup

The amount added to the cost price of goods to cover overhead and profit; it calculates the selling price.

Manufacturing Overhead

All indirect costs associated with manufacturing, excluding direct materials and direct labor, such as maintenance, depreciation, and utilities.

Predetermined Overhead Rate

A rate calculated before a period begins, based on the estimated total manufacturing overhead costs and estimated allocation base, used to allocate overhead to products or job orders.

Manufacturing Departments

Specialized sections within a manufacturing facility responsible for different stages of product production, such as assembly, finishing, or quality control.