The Relationship Between Speed of Innovation and Product Obsolescence Is

question 3

Multiple Choice

The relationship between speed of innovation and product obsolescence is

• A) direct (as innovation speed increases, products become obsolete more quickly).
• B) inverse (as innovation speed increases, products become obsolete more slowly).
• C) indirect (there is an effect, but it cannot be directly determined).
• D) nonexistent (there is no relationship at all).

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Definitions:

Average Sale Period

The average time it takes for a company to convert its inventory into sales, often used in analyzing a company's efficiency.

Cost of Goods Sold

The direct costs attributable to the production of goods sold by a company, including the cost of the materials and labor directly used to create the good.

Beginning Inventory

The value of goods available for sale at the start of an accounting period.

Inventory Turnover

A ratio indicating how many times a company has sold and replaced inventory during a certain period of time.