Before a Balanced Scorecard Can Be Developed,managers Must

question 22

Multiple Choice

Before a balanced scorecard can be developed,managers must

• A)be clear about the strategy they are trying to achieve.
• B)understand the cause-and-effect relationship between various measures.
• C)both be clear about the strategy they are trying to achieve and understand the cause-and-effect relationship between various measures.
• D)neither be clear about the strategy they are trying to achieve nor understand the cause-and-effect relationship between various measures.

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Definitions:

MC

Marginal Cost, the increase in total cost that arises from producing one additional unit of a product or service.

Total Variable Cost

Total Variable Cost is the sum of all costs that vary with the level of output produced, such as materials and labor.

Total Fixed Cost

The total of all expenses that do not change with production volume or output in the short term, for example, lease payments or wages.

Output of Zero

A theoretical condition or benchmark where no goods or services are being produced or output is completely halted.