Given the Cost Formula Y = $15,000 + $5X,total Cost

question 109

Multiple Choice

Given the cost formula Y = $15,000 + $5X,total cost at an activity level of 8,000 units would be:

• A)$23,000
• B)$15,000
• C)$55,000
• D)$40,000

---

Definitions:

Planning Horizon

The future time period for which plans, strategies, and decisions are made, varying in length depending on the goals and nature of the planning.

Forecasting Errors

Discrepancies between predicted and actual demand, often leading to inventory mismanagement.

Safety Capacity

The extra capacity created within a system to accommodate unexpected demand or to compensate for potential system failures.

Aggregate Decisions

Aggregate Decisions are strategic choices made at the corporate or strategic business unit level, focusing on overall capacity, investment, and long-term resource allocation.