Fixed Costs

question 85

Multiple Choice

Fixed costs:

• A) change as a small quantity of output produced changes.
• B) are constant over the short-run regardless of the quantity of output produced.
• C) are defined as the change in total costs when one more unit of output is produced.
• D) are subtracted from sales to compute the contribution margin.
• E) can be ignored in scenario analysis since they are constant over the life of a project.

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Definitions:

Financial Metric

Quantitative measures used to assess and track the financial health, performance, or condition of a business, such as profit margins, ROI, or cash flow.

Product Platform

A set of common designs, components, and technologies used as a base upon which various products can be developed and manufactured.

Executive Summary

A concise overview of a business plan or document, highlighting its main points, goals, and recommendations, meant to give readers a quick preview.

Marketing Plan

A comprehensive document that outlines a company's overall marketing efforts, including strategies, objectives, and activities to achieve them.