The Multiple-Of-Earnings Approach to Evaluate Life Insurance Needs Is Simplistic

question 83

True/False

The multiple-of-earnings approach to evaluate life insurance needs is simplistic but can be unreliable.

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Definitions:

Plant Sizes

Refers to the scale or capacity of a manufacturing facility or production unit in terms of its output or operations.

ATC

Abbreviation for Air Traffic Control, responsible for regulating and guiding aircrafts to ensure their safe operation in the sky.

Diseconomies of Scale

The phenomenon where production costs per unit increase as a firm's output expands, typically due to inefficiencies and increased complexity.

Average Total Costs

The total cost of production divided by the quantity of output produced; a measure of cost per unit of output.