Which Is a Type of Internal Constraint Faced by Top

question 72

Multiple Choice

Which is a type of internal constraint faced by top executives?

• A) powerful coalitions within an organization
• B) the nature of the organization's primary products
• C) the nature of the organization's primary services
• D) the types of markets in which the organization operates

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Definitions:

Contribution Margin Ratio

The percentage of sales revenue that exceeds variable costs, indicating the portion of sales available to cover fixed costs and generate profit.

Fixed Costs

Expenses that do not fluctuate with changes in production level or sales volume, such as lease payments, salaries, and insurance.

Operating Leverage

A financial concept that measures the extent to which a firm can increase operating income by increasing revenue, highlighting the impact of fixed versus variable costs.

Break-even Point

The point at which total costs equal total revenue, meaning the business makes neither a profit nor a loss.