Which of the Following Is an Example of an Operational

question 30

Multiple Choice

Which of the following is an example of an operational decision?

• A) Focus promotion on the economy of the product.
• B) Make the product available in every possible retail outlet.
• C) Have a salesperson visit the manager of a new hardware store that will open next week.
• D) Set a price that is no higher than competitors' prices.
• E) None of the above is an operational decision.

---

Definitions:

Variable Costs

Expenses that vary directly with the level of production or output, such as materials and labor costs.

Fixed Cost

Expenses that do not change with the level of production or sales, such as rent, salaries, and insurance.

Net Operating Income

A measure of a company's profitability, calculated by subtracting operating expenses from operating revenues, excluding taxes and interest.

EBIT

A financial performance metric that calculates a company's profits before accounting for interest and income tax costs, including all other expenses.