A Company That Wants to Become the Lowest Cost Producer

question 52

Multiple Choice

A company that wants to become the lowest cost producer in an industry should _____.

• A)create a product that is different from other products in the market
• B)construct efficient large-scale facilities
• C)invest heavily in branding their product
• D)invest in creating a unique customer service process
• E)start using the latest machines for its production facility

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Definitions:

Municipal Bond

A debt security issued by a state, municipality, or county to finance its capital expenditures.

Corporate Bond

A debt security issued by a corporation to raise capital, whereby the issuer promises to repay the principal along with interest at specified dates.

Tax Bracket

A range of incomes taxed at a specific rate, with different portions of income being taxed at progressively higher rates as income increases.

Collateral

An asset that a borrower offers to a lender as security for a loan, which can be seized if the borrower fails to repay the loan.