The Responsibility Report of Keith Parker,the Manager of One of the Divisions

question 75

Multiple Choice

The responsibility report of Keith Parker,the manager of one of the divisions of an auto parts manufacturing company,includes profits as well as return on investment and residual income.Keith is most likely the manager of a(n) ________.

• A) investment center
• B) profit center
• C) cost center
• D) revenue center

Analyze the incentives and profits under cartel arrangements.

Comprehend the role and outcomes of collusion in oligopoly markets compared to monopoly.

Understand the application of game theory to oligopoly markets.

Recognize the effects of the number of firms in an oligopoly on market outcomes.

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Definitions:

Cost-Plus Pricing

A method where the sale price is calculated by adding a particular markup on top of the product's cost per unit.

Variable Manufacturing Cost

Costs that vary directly with the level of production output, including direct materials and direct labor expenses.

Mark-Up Percentage

The percent difference between the cost of a good or service and its selling price, used to calculate the selling price from the cost.

Contribution Margins

The amount remaining from sales revenue after variable expenses are deducted, indicating how much contributes to covering fixed costs and generating profit.