If by Dropping a Product a Firm Can Avoid More

question 148

True/False

If by dropping a product a firm can avoid more in fixed costs than it loses in contribution margin,then the firm is better off economically if the product is dropped.

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Definitions:

Socioeconomic Status

Social class, usually measured by income level, job prestige, and/or education level.

Social Class

A division of society based on social and economic status.

Income Level

The amount of money earned by an individual or household, which can affect access to resources, social status, and lifestyle.

Birth Cohort

Everyone born in one year.