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The More a Capability Is Based on Complex Networks of Interacting

question 45

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The more a capability is based on complex networks of interacting organizational routines,the more strategically important it is because it is difficult for rivals to replicate.


Definitions:

Predetermined Overhead Rate

A rate calculated before the accounting period begins, used to allocate manufacturing overhead costs to individual units of production based on a certain activity base.

Variable Manufacturing Overhead

Costs that vary with production volume, such as indirect materials and utilities, related specifically to the manufacturing process.

Labor-Hours

The total number of working hours clocked by employees within a specific period, reflecting the labor input.

Predetermined Overhead Rate

A rate used to allocate manufacturing overhead to individual units of output on the basis of some common activity, such as machine-hours or labor hours.

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