A Project Which Is Designed to Improve the Manufacturing Efficiency

question 89

Multiple Choice

A project which is designed to improve the manufacturing efficiency of a firm but will generate no additional sales is referred to as a(n) _____ project.

• A) sunk cost
• B) opportunity
• C) cost-cutting
• D) revenue-cutting
• E) revenue-generating

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Definitions:

Deficit

A situation where expenditures exceed revenue, leading to a shortfall that must be financed through borrowing or using savings.

Earnings Per Share

A financial ratio that measures the portion of a company's profit allocated to each outstanding share of common stock, indicating the company’s profitability.

Cash Dividends

Cash distributions to shareholders from a company's earnings.

Preferred Stock

A class of ownership in a corporation with a priority claim on assets and earnings before common stock; typically does not have voting rights but has a fixed dividend.