Competitors Are Likely to Strongly Launch a Counter Attack If

question 6

Multiple Choice

Competitors are likely to strongly launch a counter attack if:

• A)they are aware of the original attack
• B)they are motivated to counterattack
• C)they have the capabilities to launch a successful counterattack
• D)all the three conditions mentioned above are present at the same time
• E)none of the conditions is present

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Definitions:

Fixed Overhead

Regular, fixed costs that do not vary with the level of production or sales, such as rent, salaries, and insurance.

Capacity

The maximum amount of goods or services a company can produce or deliver in a given period with existing resources.

Allocation Base

A criterion or measure used for distributing overhead costs among various products, services, or departments within a business.

Traditional Costing

A costing method that allocates overhead based on a single predetermined rate, usually ignoring the varying demands different products place on resources.