An Important Qualitative Factor to Consider Regarding a Special Order

question 65

Multiple Choice

An important qualitative factor to consider regarding a special order is the

• A)variable costs associated with the special order.
• B)avoidable fixed costs associated with the special order.
• C)effect the sale of special-order units will have on the sale of regularly priced units.
• D)incremental revenue from the special order.

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Definitions:

MR

Stands for Marginal Revenue, which is the additional income earned from selling one more unit of a good or service.

Economic Profit

The difference between a firm's total revenues and its total costs, including both explicit costs and opportunity costs.

Perfectly Competitive

A market structure where many firms sell identical products, entry and exit are easy, and no single seller can influence the market price.

Market Price

The present cost for purchasing or selling an asset or service within a specific market.