In Product Modification, Three Conditions Must Be Met to Improve

question 13

Multiple Choice

In product modification, three conditions must be met to improve a firm's product mix: the product must be modifiable, customers must be able to perceive that a modification has been made, and

• A) a modification should make the product more consistent with customers' desires.
• B) competing companies should not be aware of planned product modifications.
• C) a modification should change customers' desires to provide greater satisfaction.
• D) management must perceive the modification as a reasonable and necessary action.
• E) production costs and materials needed should be limited.

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Definitions:

Accounts Payable

Liabilities or amounts owed by a business to its suppliers or creditors for goods and services received but not yet paid for.

Direct Materials Budget

A financial plan that estimates the raw materials required for production and the associated costs for a specific period.

Cash Payments

Transactions in which money is paid out or disbursed by a business, typically related to operational expenses, purchases, or other financial obligations.

Raw Materials Inventory

The total cost of all components and materials a company holds that are yet to be used in the manufacturing process.