If a Firm Has Excess Production Capacity, It

question 60

Multiple Choice

If a firm has excess production capacity, it

• A) can serve as a safety net if demand suddenly picks up.
• B) may be a sign that there's too much competition.
• C) may make sense for the marketing manager to try to find new markets for current products.
• D) can be costly.
• E) all of the above.

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Definitions:

Term Insurance

A type of life insurance policy for which premiums are paid for a specified term and payment is made by the insurer only if the insured dies within the term period.

Cancel Policy

A cancel policy refers to the terms under which an agreement, insurance policy, or service contract can be terminated before its natural expiration date.

Advance Written-notice

A notification given in writing ahead of time, often a requirement in legal and contractual situations.

Incontestability Clause

A provision in a life insurance policy that prevents the insurer from disputing the policy's validity after it has been in force for a certain period, typically two years.