When a Firm Has Constrained Capacity as Opposed to Surplus

question 66

Multiple Choice

When a firm has constrained capacity as opposed to surplus capacity,opportunity costs will be:

• A)variable.
• B)greater.
• C)the same.
• D)lower.

---

Definitions:

Lockbox System

A service provided by banks to accelerate collection of payments by having those payments sent to a special post office box rather than to the company.

Treasury Bills

Represent short-term government securities issued at a discount from the par value and mature without interest payments.

Collection Time

The typical period it takes for a company to receive payments due from its clients.

Lockbox System

A service provided by banks to companies for the collection of payments from customers, involving the use of a special address (PO Box) where customers send their payments.