Active Customer Contact and Personalized Attention Can Lower Cost to the Customer

question 68

Multiple Choice

Active customer contact and personalized attention can lower cost to the customer by:

• A) increasing the capital intensity.
• B) trading fixed costs for an equivalent variable cost.
• C) substituting customer efforts for those of the service provider.
• D) lowering the level of technology involved.

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Definitions:

Market Price

The existing rate at which an asset or service can be sold or bought.

Convertible Bond

A type of bond that can be converted into a predetermined number of shares of the issuing company's stock at certain times during its life, usually at the discretion of the bondholder.

Conversion Price

The predetermined price at which convertible securities (like convertible bonds or preferred shares) can be converted into the issuing company's common stock.

Treasury Bills

Short-term government securities with maturities of one year or less sold at a discount from their face value.