Which of the Following Statements Is True About a Soft

question 30

Multiple Choice

Which of the following statements is true about a soft commitment?

• A)It is bad for competitors
• B)It is good for competitors
• C)In Cournot competition,capacity expansion is an example of a soft commitment
• D)In Betrand competition,a commitment to reduce prices is an example of a soft commitment
• E)Tough commitments are always in the best interest of a firm

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Definitions:

Ending Inventory

The total value of all inventory that a company has in stock at the end of an accounting period.

Inventory Accounting

The process of valuing and tracking physical stock and its cost flow from purchase to sale, used to determine cost of goods sold and inventory balance.

FOB Destination

A shipping term indicating that the seller bears the freight charges and retains ownership of goods in transit until they are delivered to the buyer.

FOB Shipping Point

A term used in shipping agreements indicating that the buyer takes ownership and responsibility for goods at the moment they are shipped.