Research Findings Support the I/O Model, in That Approximately ________

question 4

Multiple Choice

Research findings support the I/O model, in that approximately ________ of a firm's profitability can be explained by the industry in which it chooses to compete.However, this research also shows that ________ of the variance in profitability could be attributed to the firm's characteristics and actions.

• A)24 per cent; 40 per cent
• B)22 per cent; 42 per cent
• C)20 per cent; 36 per cent
• D)26 per cent; 38 per cent

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Definitions:

Direct Materials Purchase Budget

A financial plan that estimates the raw materials to be purchased to meet production needs and inventory policy requirements.

Ending Inventories

The value or quantity of goods available for sale or use at the end of an accounting period.

Accounts Payable

Liabilities representing amounts owed to creditors for goods and services the company has received but not yet paid for.

Raw Materials Purchases

is the total cost of raw materials bought for production during a given period.