Which of the Following Is a Cost That, If Eliminated

question 86

Multiple Choice

Which of the following is a cost that, if eliminated, would reduce the actual or perceived value or utility (usefulness) customers experience from using the product or service?

• A) Non-value-added cost
• B) Discretionary cost
• C) Value-added cost
• D) Committed cost

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Definitions:

Profit Sharing

A company policy of distributing a portion of its profits among its employees, often as a form of incentive or reward.

Marginal Cost Function

A mathematical representation that shows how the cost of producing one additional unit of output varies as production changes.

Total Cost Function

The mathematical representation that describes how total cost varies with the level of output, encompassing both fixed and variable costs.

Asymmetric Information

A situation where one party in a transaction has more or better information than the other, leading to an imbalance in power and potentially unfair outcomes.