All of the Following Are Important Factors in Determining an Optimal

question 121

Multiple Choice

All of the following are important factors in determining an optimal mode of transportation to be used in foreign markets except:

• A)the cost of transportation.
• B)the value-to-volume ratio.
• C)the perishability of the product.
• D)obsolescence along the product life cycle.
• E)the cost of insurance.

---

Definitions:

Fixed Costs

Expenses that do not change with changes in the volume of production or sales, such as rent, salaries, and insurance.

Variable Costs

Costs that vary directly with the level of production or sales activity.

Contribution Margin Ratio

A financial metric that shows the portion of sales revenue that is not consumed by variable costs and is available to cover fixed costs.

Net Income

The earnings of a company after taking into account all expenses, including operational costs, interest, and taxes, subtracted from its total revenue.