In the US, the Fundamental Goal of Business Is to

question 137

Multiple Choice

In the U.S., the fundamental goal of business is to

• A) ensure customer satisfaction.
• B) maximize shareholder wealth.
• C) provide job security.
• D) generate profits.

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Definitions:

Variable Manufacturing Costs

Costs in manufacturing that vary with the level of production output, including direct labor, materials, and utilities.

Direct Labor

The labor costs directly associated with the manufacture of products, typically wages for workers who physically produce the goods.

Net Present Value

The difference between the present value of cash inflows and outflows over a period of time, used in capital budgeting to assess the profitability of an investment.

Cost of Capital

The required return necessary to make a capital budgeting project, such as building a new plant, worthwhile.