Customer-Profitability Analysis Uses Activity-Based Costing to Determine the Activities, Costs

question 20

True/False

Customer-profitability analysis uses activity-based costing to determine the activities, costs, and profit associated with serving particular customers.

---

Definitions:

Long Run

A period of time in which all factors of production and costs are variable, allowing firms to adjust fully to market conditions.

Deadweight Loss

The loss of economic efficiency that can occur when the equilibrium for a good or a service is not achieved or achievable.

Profit-Maximizing

Profit-maximizing refers to a strategy or behavior where a firm or individual seeks to achieve the highest possible profit through their decisions and actions, often by adjusting output or pricing.

Externality

The uncompensated impact of one person’s actions on the well-being of a bystander