Which of the Following Statements About Long-Range Plans Is FALSE

question 67

Multiple Choice

Which of the following statements about long-range plans is FALSE?

• A) Long-range plans provide forecasted financial statements for five to ten year periods.
• B) Long-range plans guide day-to-day operations.
• C) Companies coordinate long-range plans with capital budgets.
• D) A decision made during long-range planning is the acquisition of a plant building.

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Definitions:

Fixed Costs

Costs that do not vary with the level of output or production, such as rent, salaries, and insurance premiums.

Monopolistically Competitive

Refers to a market structure where many firms sell similar, but not identical, products, allowing for some degree of market power and differentiation.

Profit-Maximizing Output

The level of production at which a firm achieves the highest possible profit, where marginal revenue equals marginal cost.

Short Run

A period in economic theory during which some factors of production are fixed, and only some variables, typically labor or raw materials, can be adjusted.