A Company Is Considering Eliminating a Product Line

question 115

Multiple Choice

A company is considering eliminating a product line. The fixed costs currently allocated to the product line will be allocated to other product lines upon discontinuance. If the product line is discontinued

• A) total net income will increase by the amount of the product line's fixed costs.
• B) total net income will decrease by the amount of the product line's fixed costs.
• C) the contribution margin of the product line will indicate the net income increase or decrease.
• D) the company's total fixed costs will decrease.

Analyze the role of government in creating or mitigating monopolistic markets through policies such as patents and franchises.

Learn about price discrimination and pricing strategies across different markets.

Understand the economics of innovation and how patent policies can influence industry location decisions.

Understand the concept of marginal revenue and how it plays a role in monopolistic decision-making processes.

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Definitions:

Perceptual Process

A series of steps by which individuals select, organize, and interpret sensory information to understand the environment and make decisions.

Johari Window

A psychological tool used to help people better understand their relationship with themselves and others, through identifying known and unknown facets of their personality.

Blind Area

Aspects of an individual's behaviors or personality that are unknown to themselves but visible to others, often highlighted in feedback mechanisms.

Feedback

Feedback is information provided regarding aspects of one’s performance or behaviour, which can be used for improvement and development.