Which of the Following Is Not a Limitation of the Survivor

question 6

Multiple Choice

Which of the following is not a limitation of the survivor technique for measuring the optimum size of firms within an industry?

• A) since the technique does not employ actual cost data in the analysis,there is no way to assess the magnitude of the cost differentials between firms of varying size and efficiency.
• B) the managerial and entrepreneurial aspects of the production process are not included in the analysis
• C) because of legal factors,the long-run cost curve derived by this technique may be distorted and may not measure the cost curve postulated in economic theory
• D) a and b
• E) b and c

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Definitions:

Cost Leadership

A strategy focusing on gaining competitive advantage by being the lowest cost producer in an industry while maintaining acceptable quality levels.

Manufacturing Facilities

Physical locations equipped with machinery and labor, where raw materials are transformed into finished products.

Logistics Cost

Expenses associated with the planning, implementation, and control of the movement and storage of goods and services, from origin to consumption.

Response Time

The duration it takes for a system or business process to react to a specific input or request.