Other Factors That Managers Should Consider in Deciding How to Allocate

question 160

Multiple Choice

Other factors that managers should consider in deciding how to allocate resources among customers include:

• A)likelihood of customer retention
• B)long-run customer profitability
• C)potential for sales growth
• D)All of these are correct.

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Definitions:

Marginal Cost

The amount spent on producing one more unit of a good or service.

Average Total Cost

The per unit cost of production, calculated by dividing the total cost by the quantity of output produced.

Economic Profits

Economic profits consist of the total revenue generated by a business minus both its explicit and implicit costs, reflecting the actual profitability including opportunity costs.

Cherry Industry

A sector of agriculture focused on the cultivation, harvesting, and marketing of cherries, including both sweet and sour varieties.