If a Firm Currently Has Excess Capacity,then Using the Percent

question 57

True/False

If a firm currently has excess capacity,then using the percent of sales method to forecast its fixed asset balance will likely result in an overestimate of the fixed asset balance and an inflated amount of discretionary financing needed.

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Definitions:

Total Utility

The overall satisfaction a consumer receives from consuming a particular quantity of goods or services.

Marginal Utility

The additional satisfaction or benefit a consumer gains from consuming one more unit of a good or service.

Purchases Shift

A change in the buying behavior of consumers, often referring to a movement in demand for goods or services in the market.

Utility Change

refers to changes in the level of satisfaction or happiness that a consumer derives from consuming goods or services, indicating shifts in preferences or economic circumstances.