What Form of Efficiency Did Mercedes-Benz Capture by Initially Producing

question 112

Multiple Choice

What form of efficiency did Mercedes-Benz capture by initially producing its sport utility vehicle only in Alabama?

• A) multinational flexibility
• B) economies of scale
• C) location efficiencies
• D) economies of scope

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Definitions:

Monthly Sales

The total revenue generated from sales within a month, often tracked to assess business performance.

Variable Costs

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

Sales Commissions

Fees paid to salespersons or agents based on the value or volume of sales achieved, typically expressed as a percentage.

Fixed Selling Expenses

Costs associated with selling a product or service that do not change with the level of production or sales, such as salaries of sales personnel and rent of the sales office.