A Policy of Dropping Any Customer That Is Currently Unprofitable

question 124

True/False

A policy of dropping any customer that is currently unprofitable will eliminate, in the short run, all of the costs assigned to it.

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Definitions:

Portfolio Beta

A measure of the volatility of a portfolio compared to the market as a whole, indicating the expected percentage change in a portfolio's value for a 1% change in the market.

Alpha

A measure of the active return on an investment, gauging how much a portfolio or fund outperforms or underperforms its benchmark index.

Hedge Fund

An investment fund that employs various strategies to produce high returns, including leverage, short-selling, and derivatives, accessible typically to wealthy investors.

Incentive Bonus

A form of additional compensation paid to an employee as a reward for achieving certain goals or exceptional performance.