When the Defense Department Ordered 132 New Airplanes, the Cost

question 302

Multiple Choice

When the Defense Department ordered 132 new airplanes, the cost per plane was estimated to be $580 million. A cut in the order to 75 planes increased the per plane cost to $800 million. This change in per unit cost can be explained by

• A)a move to minimum efficient scale.
• B)the law of diminishing returns.
• C)the loss of economies of scale.
• D)an increase in total fixed cost.

Recognize how express and implied warranties are established and their implications.

Learn about the extension of seller's warranties to third-party beneficiaries and the rights of these beneficiaries under different jurisdictions.

Comprehend the criteria for breach of warranties and the conditions required for goods to be considered merchantable.

Understand the rights and limitations related to waiving warranty rights by the buyer.

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Definitions:

Birds of Feather

A phrase used to express the idea that similar people tend to associate with each other.

Opposites Attract

A theory suggesting that individuals with complementary traits or characteristics are more likely to form a partnership.

Blind Date

A social engagement between two persons who have not previously met, often arranged by a mutual acquaintance.

Physical Attractiveness

The extent to which an individual's physical attributes are deemed attractive or lovely by people.