Use the Information Below to Answer the Following Questions

question 76

Multiple Choice

Use the information below to answer the following questions.
Fact 10.1.1 The Colvin Interview: Chrysler
The key driver of profitability will be that the focus of the company isn't on profitability. Our focus is on the customer. If we can find a way to give customers what they want better than anybody else, then what can stop us?
Source: Fortune, April 14, 2008
-Refer to Fact 10.1.1. If Chrysler doesn't focus on maximizing profit, but instead focuses their production and pricing decisions to "give customers what they want", Chrysler would

• A)eventually incur a loss and either leave the market or be taken over by another firm.
• B)force foreign competition out of the North American car market.
• C)eventually force the other North American car producers out of the North American car market.
• D)definitely and permanently increase market share.
• E)lower the prices of their vehicles to the point at which price equals opportunity cost.

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Definitions:

Factory Payroll

The total wages, salaries, and benefits paid to employees working in a manufacturing facility during a specific period.

Underapplied Overhead

Underapplied overhead occurs when the allocated manufacturing overhead costs are less than the actual overhead costs incurred.

Overapplied Overhead

A situation where the allocated manufacturing overhead cost is more than the actual overhead costs incurred.

Total Manufacturing Costs

The aggregate of all costs involved in the production of a product, including direct materials, direct labor, and overhead.