In Order to Take Advantage of Economies of Scale,large Businesses

question 103

Multiple Choice

In order to take advantage of economies of scale,large businesses usually

• A) Devote resources to produce selected quantities of products
• B) Devote resources to produce large quantities of products
• C) Devote resources that are committed for only short time periods
• D) Devote resources that are able to quickly respond to a changing market

Analyze the effects of changes in costs (fixed and variable) and sales price on the break-even point and overall financial performance.

Calculate target income levels and understand the process of achieving financial goals through CVP analysis.

Understand the role and computation of the contribution margin in multi-product companies.

Interpret and apply the concepts of margin of safety and operating leverage in business scenarios.

---

Definitions:

Yield Management

A pricing strategy used in industries with fixed capacities to maximize revenue by adjusting prices based on demand.

Operations Management

is the area of management concerned with designing and controlling the process of production and redesigning business operations in the production of goods or services.