If a Firm Uses Unit Production and Makes Custom Products

question 107

Multiple Choice

If a firm uses unit production and makes custom products, it should have a _________ structure with a _________ managerial span of control is most appropriate.

• A) flatter, smaller
• B) flatter, larger
• C) taller, smaller
• D) taller, larger
• E) none of these

---

Definitions:

Marginal Cost

The additional cost incurred by producing one more unit of a product or service.

Producing Unit

A part of a company or a machine that is responsible for manufacturing or creating goods.

Units

A standard measure or quantity used to specify or quantify the amount of a product, service, or resource.

Prices

The amount of money required to purchase goods or services.