An Operating Unit of an Organization Is Called an Investment

question 5

Multiple Choice

An operating unit of an organization is called an investment center if it is responsible:

• A) only for costs.
• B) only for revenues.
• C) for costs and revenues.
• D) for investments in assets.

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Definitions:

Marginal Cost

Marginal Cost is the cost of producing one additional unit of a product or service, a crucial concept in decision-making and pricing strategies.

Monopolist

An entity that holds exclusive control over the supply of a particular good or service, allowing them to manipulate market conditions.

Economic Profits

The difference between a firm's total revenues and its total costs, including both explicit and implicit costs, indicating the firm's profit beyond its opportunity cost.

Equilibrium Level

A state in which economic forces such as supply and demand are balanced, often resulting in stable prices or market conditions.