Systems That Identify the Costs of Producing Defective Units as Well

question 112

Multiple Choice

Systems that identify the costs of producing defective units as well as low-quality items that lose sales are called:

• A) customer relationship management systems.
• B) distribution chains.
• C) enterprise resource planning systems.
• D) cost of quality systems.

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Definitions:

Value-based Pricing

A pricing strategy where the price is set based on the perceived value to the customer rather than based on the cost of the product or historical prices.

Economic Value

The measure of the benefit provided by a good or service to an economic agent.

Target Costing

Target costing is a pricing method used during the development phase of a product to ensure that costs do not exceed the target price minus desired profit, thereby ensuring competitiveness and profitability.

Selling Price

The amount of money charged for a product or service, determined by considering factors such as cost of production, market demand, and competitors' prices.