Situation Analysis Requires a Firm to Consider the External Forces

question 99

Multiple Choice

situation analysis requires a firm to consider the external forces and trends that affect it.Some of these may be favorable to the organization while others may be unfavorable.Which of the following is an example of an external force?

• A) The firm buys its own fleet of trucks, so it no longer needs to hire a trucking company for distribution.
• B) A hiring freeze is put into place. Although no one is fired, no one can be hired.
• C) A goal is set to close the gap between production costs and profits.
• D) A local government requires that all businesses within the city limits must recycle or be fined.
• E) Shareholders are rewarded with a sizeable dividend check.

Understand the impact of operational decisions on net income.

Calculate and understand contribution margin.

Understand the calculation of manufacturing margin.

Calculate total variable and fixed overheads.

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Definitions:

Time-Series Graph

A visual representation of data points in chronological order, used to analyze trends over time.

Pie Chart

A circular statistical graphic divided into slices to illustrate numerical proportion.

Bar Graph

A graph that uses bars of varying heights or lengths to show the comparative sizes of different observations of a variable.

Linear Curve

A linear curve is a straight line graphically showing the relationship between two variables, with a constant slope and no curvature.