Output Is Usually Defined as Sales Units in Merchandising,but Service

question 28

True/False

Output is usually defined as sales units in merchandising,but service organi­zations use measures of activity units,like patient days.

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Definitions:

Internal Rate Of Return

A financial metric used to estimate the profitability of potential investments, calculated as the rate of return that makes the net present value of all cash flows from a particular project equal to zero.

Net Present Value

A method used in capital budgeting to assess the profitability of an investment, calculated by subtracting the projected cash outflows from the present value of cash inflows.

Opportunity Cost

The cost of foregoing the second-best option when making a decision, representing the benefits that could have been received by taking a different action.

Make-Or-Buy Decision

A decision-making process used by businesses to determine whether to produce goods in-house or purchase them from an external supplier.