In Order to Keep the Customer Happy and to Keep

question 36

True/False

In order to keep the customer happy and to keep perceptions about performance high, it is acceptable to falsely assure customers that everything is on track, especially if you feel that the problem will be resolved soon.

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Definitions:

Fixed Expenses

Expenses that remain constant regardless of production or sales volume, including items like lease payments, employee wages, and insurance costs.

Financial Advantage

The benefit gained from making economic decisions that result in increased wealth or financial health.

Average Cost

A method of cost valuation that calculates the cost of goods sold and inventory based on the average cost of all similar items in inventory.

Fixed Manufacturing Overhead

Costs that do not vary with the level of production, such as rent, salaries, and equipment depreciation, associated specifically with manufacturing.