Which of the Following Statements Is INCORRECT Regarding the Disadvantages

question 50

Multiple Choice

Which of the following statements is INCORRECT regarding the disadvantages of simulation?

• A) Each simulation run only provides a sample of how the real system will operate.
• B) The summary of the simulation data only provides estimates about the real system.
• C) The process of developing a simulation model of a complex system can be time-consuming.
• D) The larger the number of probabilistic inputs a system has, the less likely a simulation will provide the best approach for studying the system.

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Definitions:

Fixed Cost

Costs that do not vary with the level of production or sales, remaining constant within a specific range of activity.

Contribution Margin

The difference between a company's sales revenue and its variable costs.

Traceable Fixed Expenses

Fixed costs that can be directly linked to a specific business segment or operation.

Net Operating Income

A company's income after all operating expenses are deducted but before interest and taxes are accounted for.