Because a Market Is Saturated, Firms May Attempt to Enter

question 80

Multiple Choice

Because a market is saturated, firms may attempt to enter new geographical markets that may be less saturated. For example, pharmaceutical companies are realizing that they need to turn to ________ for continued growth in the coming years.

• A)BRIC countries
• B)third-world countries
• C)communist countries
• D)Germany
• E)France

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Definitions:

Units of Activity

A depreciation method that allocates an asset's cost based on its usage, activities, or units produced, rather than the passage of time.

Total Fixed Costs

The sum of all costs that do not change with the level of output or sales, over a specific period.

Level of Activity

A measure of the volume or quantity of production or operations in a given period, often used in cost accounting to analyze costs.

Mixed Cost

An expense that contains both fixed and variable components, changing with the level of output but also incurred when there is no output.