Direct Interaction Between Customer and Employee Is Generally Very High

question 10

True/False

Direct interaction between customer and employee is generally very high with services, while there is little direct interaction between customers and employees in the technical core of a manufacturing firm.

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Definitions:

Variable Costs

Costs that vary directly with the level of production or sales volume, such as raw materials and labor.

Fixed Costs

Expenses that do not change with the level of production or business activity, such as rent or salaries.

Idle Capacity

Unused production capacity in a business, where the facilities, equipment, or workforce are not being fully utilized.

Underutilized Labor

A situation where employees are not working at their full capacity or skill level, leading to inefficiency and increased labor costs.