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Percentage of Sales Models Usually Assume That Costs, Fixed Assets

question 14

Essay

Percentage of sales models usually assume that costs, fixed assets, and working capital all increase at the same rate as sales. When do you think that these assumptions do not make sense? Would you feel happier using a percentage of sales model for short-term or long-term planning?


Definitions:

Safety

The state of being safe from or not prone to causing harm, risk, or damage.

Legitimately

Legitimately refers to something conducted in accordance with established legal rules, principles, or standards.

Distributive Justice

A principle concerned with the fair allocation of resources among diverse members of a community.

Libertarian

A political ideology favoring minimal state intervention in the personal and economic affairs of individuals, emphasizing freedom and voluntary association.

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