Identify the Correct Statement About Differentiation

question 19

Multiple Choice

Identify the correct statement about differentiation.

• A)It usually implies lower costs for the customers.
• B)For highly technical products,differentiation is built solely on the basis of perception.
• C)It is based on obtaining an observable point of difference that customers will value.
• D)Consumer products are usually differentiated through real difference.

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Definitions:

Cost Driver

A factor that causes a change in the cost of an activity.

Machine Hours

A measure of the amount of time a machine is operated, used in calculating manufacturing costs and efficiency.

Fixed Overhead Volume Variance

The difference between the budgeted fixed overhead and the actual fixed overhead incurred, due to changes in production volume.

Standard Cost

A predetermined cost of manufacturing an item, including direct materials, labor, and overheads, used for budgeting and performance evaluation.