Value Chain and Classification of Costs, Car Company

question 152

Essay

Value chain and classification of costs, car company.
General Motors incurs the following costs:
a. Electricity costs for the plant assembling the Chevrolet Camaro
b. Transportation costs for shipping the Camaro to dealers
c. Payment to Shelby Designs for the design of the Camaro.
d. Salary of an engineer working on the next generation of Camaros
e. Cost of GM employees' visit to an auto show to demonstrate the Camaro
f. Testing the Camaro at the GM track
g. Payment to television network for running Camaro advertisements
h. Cost of brake pads purchased from outside supplier to be installed on the Camaro
Required:
Classify each of the cost items (a-h) into one of the business functions of the value chain.
1) Research and development
2) Design of products and processes
3) Production
4) Marketing and sales
5) Distribution
6) Customer service

---

Definitions:

Educational Attainment

The highest level of education that an individual has completed, often used as an indicator in social science research.

Educational System

A formalized framework of learning and teaching processes, institutions, policies, and programs designed to develop skills and knowledge.

Mass Labour Force

The term describes a large group of workers, often referring to the general working population within an economy.

Modern Science

The systematic study of the natural world and universe based on empirical evidence, experimentation, and rational analysis developed from the Renaissance onwards.