By Understanding Customer Needs, ACE Hardware Has Been Able to Increase

question 26

Multiple Choice

By understanding customer needs, ACE Hardware has been able to increase value to customers without

• A) increasing service.
• B) increasing the size of its staff.
• C) increasing advertising spending.
• D) increasing costs.
• E) increasing hours of service.

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Definitions:

Diminishing Marginal

A principle stating that as additional units of a variable input are added to a fixed input, the additional output produced from each new unit will eventually decline.

Indifference Curves

A graphical representation of different combinations of goods or services among which a consumer is indifferent, showing preferences and trade-offs.

Completeness

In the context of preferences, the assumption that any two bundles of goods can be compared, meaning a consumer can decide if one is preferred, the other is preferred, or they are valued equally.

Transitivity

The concept in decision theory and economics that if preference or choice A is preferred to B, and B is preferred to C, then A must be preferred to C.