Which of the Following Statements Is True About Marginal Analysis

question 45

Multiple Choice

Which of the following statements is true about marginal analysis?

• A)It assumes that the firm's total revenue curve is a straight line.
• B)It bases the analysis on the cost of the first few units sold.
• C)It explicitly considers demand when calculating price.
• D)It takes into account the break-even point.
• E)It focuses on the highest price per unit.

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Definitions:

Value-based Management

A management approach that focuses on creating maximum value for shareholders and customers by basing decisions on their potential to increase value.

Economic Value

The value that an asset or service provides to its user, often measured in terms of its ability to generate income or save costs.

Value Drivers

Factors that significantly impact the value of a company's products or services, which in turn affect the company's profitability and market value.

Decrease Value

A reduction in the worth or value of an asset or entity.