​Eddys' Electronics Found That Instead of Producing a Dvd Player

question 26

Multiple Choice

​Eddys' Electronics found that instead of producing a dvd player and a gaming system separately,it is cheaper to incorporate dvd playing capabilities in their new version of the gaming system.Eddy's is taking advantage of

• A)​Economies of Scale
• B)Learning curve
• C)Economies of Scope
• D)​Decreasing marginal costs

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Definitions:

Times Interest Earned Ratio

A debt management ratio indicating the degree of risk to lenders that a company will default on its interest payments. Also called interest coverage ratio.

Return on Sales Ratio

A measure of a company's operational efficiency, calculated by dividing operating profit by net sales.

Return on Total Assets

A profitability ratio that measures the net income produced by total assets during a period by comparing net income to the average total assets.

Ratio

A relationship of two quantities or numbers, one divided by the other.