Multiple Products Make Using Financial Models More Complex

question 27

Multiple Choice

Multiple products make using financial models more complex.To deal with this,managers can

• A)treat each product line as a separate entity.
• B)assume a weighted average contribution margin.
• C)use sales dollars as a measure of volume.
• D)All of the answers are correct.

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Definitions:

Length

The measurement or extent of something from end to end; the greater of two or the greatest of three dimensions of an object.

Plot

The sequence of events or main story in a narrative or literary work.

Interaction Term

In statistics, an interaction term is used in models to determine if the effect of two or more variables on a response variable is not additive, indicating that the variables interact in how they influence the response.

Coefficient

A numerical or constant quantity placed before and multiplying the variable in an algebraic expression.