The Analysis Tool That Helps Determine What Products to Develop

question 131

Multiple Choice

The analysis tool that helps determine what products to develop, and by what strategy, by listing products in descending order of their individual dollar contribution to the firm is

• A) decision tree analysis
• B) Pareto analysis
• C) breakeven analysis
• D) product-by-value analysis
• E) product life cycle analysis

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Definitions:

Actual Costs

The real costs incurred in the production of goods or the provision of services.

Revenue Variance

The difference between actual revenue and budgeted or forecasted revenue, indicating the performance of a business.

Flexible Budget

A budget that adjusts or flexes with changes in volume or activity, allowing for more accurate budgeting in variable operational conditions.

Materials Price Variance

The difference between the actual unit price paid for an item and the standard price, multiplied by the quantity purchased.