Supply's Growing Involvement in the Acquisition of Services May Be

question 4

Multiple Choice

Supply's growing involvement in the acquisition of services may be explained by:

• A) declining technical knowledge of internal users of services.
• B) the need for more of a personal relationship with the service supplier.
• C) the fact that price and service-delivery requirements are complex.
• D) the growing respect for supply managers as equals in the organization.
• E) the high dollars spent on services and the opportunities to reduce costs.

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Definitions:

Break-even Quantity

The volume of production or sales at which total revenues equal total costs, resulting in no net loss or gain for a business.

Variable Costs

Expenses that fluctuate with the level of output or production activity.

Profit

The financial gain realized when the revenue from business activities exceeds the expenses, costs, and taxes needed to sustain the activity.

Cost of Capital

The minimum profit rate a business needs to generate from its investments to keep its market value stable and draw in financing.