Use the Information Below to Answer the Following Question(s)

question 69

Multiple Choice

Use the information below to answer the following question(s) .Following a strategy of product differentiation, Barry Company makes an XX 300.Barry Company presents the following data for the years 1 and 2. Barry Company produces no defective units but it wants to reduce direct materials usage per unit of XX 300 in year 2.Manufacturing conversion costs in each year depend on production capacity defined in terms of XX 300 units that can be produced.Selling and customer-service costs depend on the number of customers that the customer and service functions are designed to support.Neither conversion costs or customer-service costs are affected by changes in actual volume.Barry Company has 23 customers in year 1 and 25 customers in year 2.The industry market size for high-end appliances increased 5% from year 1 to year 2.
-________ measures the change in operating income attributable solely to changes in a company's profit margins between years one and two.

• A)The growth component
• B)The price-recovery component
• C)The productivity component
• D)The cost leadership component
• E)The strategy component

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Definitions:

Turns

The number of windings in a coil or inductor, affecting its inductance and magnetic field strength.

Primary Wire

The main wire in an electrical circuit that carries the voltage from the source to the load, often distinguished by its insulation and gauge size.

Secondary Wire

Typically refers to the output wire or winding of a transformer or a component that operates at a lower voltage relative to a primary component.

Primary Winding

The winding of a transformer to which the power line is connected.