A Company Should

question 57

Multiple Choice

A company should

• A)eliminate any segment in which the contribution margin is less than the fixed costs that are unavoidable.
• B)eliminate an unprofitable product line as it will always increase the total profits of a company.
• C)eliminate an unprofitable product as fixed expenses allocated to the eliminated segment will likely be eliminated.
• D)identify the relevant costs in deciding whether to eliminate an unprofitable segment.

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Definitions:

Typology

A classification system used to categorize objects, concepts, or people based on common characteristics.

Sociogram

A visual representation or diagram highlighting the relationships and interactions within a group, often used in social network analysis.

Metaphor

A figure of speech in which a word or phrase is applied to an object or action to which it is not literally applicable, often to suggest a resemblance.

Hypermedia Ethnography

Integrates multimedia forms such as videos, sounds, and texts in ethnographic research to provide a more dimensional understanding of cultural practices.