An External Search for Product Information Is Likely to Occur

question 184

Multiple Choice

An external search for product information is likely to occur when

• A) the cost of gathering information is low.
• B) review of past experience provides adequate information.
• C) the risk of making a wrong purchase decision is low.
• D) the item is frequently purchased.
• E) the item is for personal use rather than for professional use.

---

Definitions:

Activity Range

Activity range refers to the span of levels of operational activity that a business can perform within, while maintaining efficiency and effectiveness in its processes or production.

Production Level

The quantity of goods or services produced during a specified time period.

Manufacturing Overhead

All indirect costs associated with the production process, like utilities, maintenance, and factory management salaries, excluding direct materials and labor.

Spending Variance

The difference between the actual amount of money spent and the budgeted amount for a particular period or item.