Two Fatal Flaws Can Render a Business Model Untenable from the Beginning

question 53

True/False

Two fatal flaws can render a business model untenable from the beginning: a complete misread of the customer and underutilization of the Internet.

---

Definitions:

Rate Variance

The difference between the actual rate and a predetermined or standard rate.

Direct Labor-Hours

The aggregate of direct labor hours required for manufacturing a good or rendering a service.

Variable Overhead

Indirect production costs that vary with the level of output, including supplies and utilities necessary for production but not directly tied to specific products.

Efficiency Variance

The difference between the actual amount of resources used in production and the amount that should have been used, reflecting efficiency in resource usage.