If a Firm Has Excess Capacity, Which of the Following

question 94

Multiple Choice

If a firm has excess capacity, which of the following is a sensible bidding strategy?

• A) Set a price to cover all costs.
• B) Base the bid on the incremental costs incurred because the job will contribute toward covering the company's fixed costs and profit.
• C) Base the bid solely on direct labour hours.
• D) Common fixed costs must be allocated to individual jobs before preparing the bid.

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Definitions:

Frequency Recording

A method of data collection in behavior analysis that involves counting the number of times a specific behavior occurs within a set period.

Time Sampling

A behavioral observation technique that involves observing the presence or absence of behaviors within specific time intervals.

Frequency

The rate at which an event or behavior occurs over a specified period of time.

Anecdotal

Pertaining to a short and interesting story or personal account, often used as informal evidence to support a point.