Trade-Off Analysis Is Becoming Increasingly Valuable for Industrial Product Innovation

question 40

Multiple Choice

Trade-off analysis is becoming increasingly valuable for industrial product innovation because:

• A)business buyers tend to make a more rational analysis of product features than consumers.
• B)businesses have more funds to spend than consumers.
• C)business buyers are interested in quick transactions and long-term relationships with the suppliers.
• D)industrial product innovation is relatively simple.

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Definitions:

Variable Overhead Efficiency Variance

The difference between actual and budgeted variable overhead costs, attributable to differences in productive efficiency.

Favorable

A term used in finance and accounting to describe a situation or variance that is better than expected or budgeted, often indicating profits or gains.

Labor Efficiency Variance

The difference between the actual labor hours used to produce a good or service and the standard labor hours expected to be used, measuring labor efficiency.

Variable Overhead Rate Variance

The difference between the actual variable overhead incurred and the expected (or standard) variable overhead based on activity levels.