The More the Cost Base Is Composed of Fixed or Indirect

question 108

True/False

The more the cost base is composed of fixed or indirect costs,the more easy it is for managers to use cost reduction strategies to protect the organization's profitability in response to decreases in demand for products and services.

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Definitions:

Structural Model

An abstract representation that illustrates the framework of an object, system, or concept, detailing the arrangement and interaction of its parts.

Ego

The part of the mind that mediates between the conscious and the unconscious and is responsible for reality testing and a sense of personal identity.

Id

The unconscious mind, motivated for pleasure and wish fulfillment.

Superego

In psychoanalytic theory, the part of the personality responsible for moral standards and conscience.