The Major Disadvantage of an Empty Shell Solution as a Second

question 22

Multiple Choice

The major disadvantage of an empty shell solution as a second site backup is

• A)the host site may be unwilling to disrupt its processing needs to process the critical applications of the disaster stricken company
• B)intense competition for shell resources during a widespread disaster
• C)maintenance of excess hardware capacity
• D)the control of the shell site is an administrative drain on the company

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Definitions:

Contribution Margin Ratio

The contribution margin ratio is a financial metric that measures the proportion of revenue that exceeds total variable costs, indicating how much of each sale contributes to covering fixed costs.

Profit-Volume Ratio

A financial tool used to analyze the relationship between profit and sales volume, showing the impact of sales changes on profits.

Unit Contribution Margin

The dollars available from each unit of sales to cover fixed costs and provide operating profits.

Break-Even Point

The level of operations at which a company’s revenues and expenses are equal.