A Management Guideline That Advises Managers to Commit Funds for Planning

question 70

Multiple Choice

A management guideline that advises managers to commit funds for planning only if in the foreseeable future they can anticipate a return on planning expenses as a result of the long-range planning analysis is known as the ________.

• A)strategic planning
• B)the commitment principle
• C)organizational planning
• D)tactical planning
• E)the principle of the objective

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Definitions:

Minimum Efficient Scale

The smallest amount of production a company can achieve while still taking full advantage of economies of scale in terms of lowering the average cost per unit.

Long-run Average Total Cost

The average cost per unit of output over the long term, where all inputs are considered variable.

Output Q₀

The quantity of goods or services produced in a given period of time, denoted as Q₀ to specify a particular amount.

Diseconomies of Scale

The phenomenon where, as a firm expands, its costs start increasing per unit of output, usually due to inefficiencies and management challenges that arise with size.