Suppose That You Were Trying to Determine How Much Income

question 38

Multiple Choice

Suppose that you were trying to determine how much income was available for future monetary needs as well as for investments. You would most likely use which of the following ratios?

• A) current ratio
• B) debt ratio
• C) savings ratio
• D) total asset turnover
• E) none of the above

Understand the structure and coordination of global purchasing operations.

Assess and compare the total cost of ownership between international and domestic suppliers.

Appreciate the strategic advantages of entering new markets through purchasing activities.

Know the entities involved in facilitating international buying and their roles.

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Definitions:

Mixed Cost

A cost that contains both variable and fixed cost elements; it changes with the level of activity but not in direct proportion.

Least-squares Regression

A statistical method used to determine the line of best fit by minimizing the squares of the differences between observed and predicted values.

Variable Manufacturing Cost

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

Production Volume

The amount of products or services generated by a business over a particular time frame.