Which of the Following Is an Advantage of Pursuing Cost

question 5

Multiple Choice

Which of the following is an advantage of pursuing cost leadership?

• A)Sales always increase with increasing amounts of output
• B)Loss of sales does not reduce scale benefits
• C)The strategy easily accommodates changes in the market
• D)Firms invest heavily in differentiating their products
• E)A firm may charge the same price as its competitors but make a higher profit

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Definitions:

Direct Manufacturing Cost

Expenses directly associated with the production of goods, including labor and materials.

Units Produced

The aggregate count of finished products produced over a designated time frame.

Direct Manufacturing Cost

Expenses directly associated with the production of goods, including raw materials and direct labor costs.

Units Produced

The total number of complete items manufactured during a specific period.