Costs Incurred to Determine Whether Products and Services Are Conforming

question 13

Multiple Choice

Costs incurred to determine whether products and services are conforming to their requirements or customer needs are

• A) prevention costs.
• B) appraisal costs.
• C) internal failure costs.
• D) external failure costs.
• E) a different category of quality related costs.

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Definitions:

Interproduct Competition

Interproduct Competition refers to the competition between different products that serve similar purposes, encouraging diversity and improvement in the market.

Monopolistic Competition

A market structure where many companies sell products that are similar but not identical, allowing for competition based on other factors than price.

Economies of Scale

The financial advantages gained by enterprises from their operational size, where the per-unit cost decreases as the operation size increases.

Unit Cost

The cost incurred to produce, manufacture, or acquire one unit of a product or service.