Shaffer Company Presents the Following Data for 2010

question 37

Multiple Choice

Shaffer Company presents the following data for 2010. The merchandise inventory turnover for 2010 is:

• A) 5.6
• B) 15.6
• C) 7.5
• D) 7.7
• E) none of the answers are correct

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Definitions:

Decreasing Returns to Scale

Decreasing returns to scale occur when an increase in all inputs leads to a less than proportional increase in output, showing that the firm becomes less efficient as it scales up production.

Increasing Opportunity Costs

A situation where the cost of forgoing the next best alternative increases as more resources are devoted to an activity.

Scale Reduction

The process of decreasing the size or output level of operations in a business or economic system.

Total Cost

The complete cost of production, including both fixed and variable costs, for a specific level of output.