The Purpose of Determining the Critical Path on a PERT

question 137

Multiple Choice

The purpose of determining the critical path on a PERT network is to

• A) identify the sequence of tasks that takes the longest to complete.
• B) estimate a payment schedule so that a budget can be established.
• C) find the sequence of events that is the most expensive to complete.
• D) establish a delivery schedule for a just-in-time inventory control program.

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Definitions:

Carrying Cost

Costs incurred by holding inventory, including storage, insurance, and opportunity costs, over a specific period.

Credit Sales

Credit sales are transactions where the purchase of goods or services is made on credit, with payment to be made at a later date.

Lenient Credit Terms

Lenient credit terms are more favorable conditions provided by a lender, allowing for longer repayment periods or lower interest rates to facilitate easier repayment for the borrower.

Uncollectible Accounts

Accounts receivable that are considered unlikely to be collected and thus written off as a bad debt expense.