Elimination of Low-Value-Added Activities in a Firm Should

question 49

Multiple Choice

Elimination of low-value-added activities in a firm should:

• A)Be discouraged because of potential harmful effects.
• B)Not affect customer value.
• C)Not have priority because low-value-added activities have little effect on a firm's performance.
• D)Have priority only when a firm is operating at a loss.
• E)Happen naturally if the firm is well-managed.

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Definitions:

Property Right

Legal rights to use, control, and derive benefits from a resource or property.

Pollution

The introduction of harmful substances or products into the environment, causing adverse effects on living organisms and ecosystems.

Public Good

A product or service that is provided without profit to all members of a society, either freely or by the government, and which is non-excludable and non-rivalrous.

Marginal Benefit

The additional satisfaction or utility a consumer receives from consuming an additional unit of a good or service.