When a Firm's AC Eventually Starts to Rise, It Is

question 40

Multiple Choice

When a firm's AC eventually starts to rise, it is often because

• A)executive salaries rise sharply as output rises.
• B)the ability to manage larger and larger levels of output results in much higher administrative costs.
• C)marginal cost increases rapidly at higher output levels.
• D)firm output has started to decline.

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Definitions:

Financial Perspective

A viewpoint focusing on the monetary aspects of an organization's strategy, often evaluated using financial performance indicators.

Return On Investment

A metric for assessing the effectiveness or profits from an investment, determined by dividing the net earnings by the investment's expense.

Performance Metrics

Performance metrics are quantifiable measures used to gauge an organization's performance in various areas, similar to the purpose of a performance measurement system but focused on specific measurable outcomes.

Nonfinancial Metrics

These metrics evaluate aspects of a business that aren't directly related to financial figures, such as customer satisfaction or employee turnover.