Which of the Following Statements About Theoretical Capacity Is BEST

question 19

Multiple Choice

Which of the following statements about theoretical capacity is BEST?

• A)Theoretical capacity allows adjustments for preventive maintenance.
• B)Running a factory at this level for a short time is often better than permanently raising resource levels.
• C)Theoretical capacity levels are usually lower than rated capacity levels.
• D)Theoretical capacity levels take into account that machines occasionally break and that workers occasionally call in sick.

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Definitions:

Market Price

The current price at which an asset or service can be bought or sold in a particular market.

Earnings per Share

A financial indicator showing the portion of a company's profit allocated to each outstanding share of common stock.

Current Ratio

A liquidity ratio that measures a company's ability to pay short-term obligations or those due within one year, calculated by dividing current assets by current liabilities.

Stock Dividend

A payment made by a corporation to its shareholders in the form of additional shares, rather than cash.