New Product Development Adds Value to a Firm's Products and Services

question 16

True/False

New product development adds value to a firm's products and services through innovation.

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Definitions:

Step-Variable Cost

The cost of a resource that is obtained in large chunks and that increases and decreases only in response to fairly wide changes in activity.

Contribution Margin

It is the difference between the sales revenue of a product and its variable costs. The contribution margin represents the portion of sales revenue that is not consumed by variable costs.

Behaviour

The actions or reactions of a person or system in response to external or internal stimuli.

Contribution Margin

The amount remaining from sales revenue after variable expenses have been deducted, contributing to covering fixed expenses and profit.