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Which of the Following Statements About Competitive Bidding Is/are True

question 70

Multiple Choice

Which of the following statements about competitive bidding is/are true?
i. The higher the price that is bid, the greater the profit, if the firm gets the contract.
ii. Bidding a higher price increases the probability of obtaining the contract.
iii. A company bidding low enough to ensure the acceptance of a contract may have bid too low to make an acceptable profit on the job.


Definitions:

Variable Cost

Expenses that change in proportion with production output or sales, such as materials and labor.

Fixed Costs

Costs that remain constant regardless of the amount of goods produced or sold, like lease payments, wages, and coverage fees.

Selling Price

The amount for which a good or service is sold, determining the revenue generated from sales activities.

Variable Cost

Costs that change in proportion to the level of activity or volume of production in a business.

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