Give an example of an option to expand a project. Why might this be of value?
What will be an ideal response?
The estimated cash flows associated with a project can change over time, making it valuable to expand a project. The
flexibility to adjust production to demand has value. For example, a firm might deliberately build a production plant
with excess capacity so that if the product has greater than-anticipated demand, the firm can simply increase
production. Alternatively, taking on this project might provide the firm with a foothold in a new industry and lead to
other products that would not have otherwise been feasible. This reasoning has led many firms to expand into
e-businesses, hoping to gain know-how and expertise that will lead to other profitable projects down the line. It also
provides some of the rationale for research and development expenditures to explore new markets.
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Systems implementation is triggered by:
a. the approved configuration plan b. the approved system design document c. both a and b d. neither a or b
A market segment is a subset of a larger market of people or organizations who will respond similarly to a marketing mix
Indicate whether the statement is true or false
Which of the following statements is most likely true about products and product knowledge?
A) Knowledge of a company's history is essential to selling that company's product. B) Product knowledge is not as important as selling technique for a professional salesperson. C) Knowledge of one's product or service is not important in all areas of professional selling. D) The extensive variety of available products in the market complicates the buying process. E) Salespeople who learn and impart too much product knowledge hinder the buying process.
The magnitude of operating leverage for Blue Ridge Corporation is 3.5 when sales are $200,000 and net income is $36,000. If sales decrease by 6%, net income is expected to decrease by what amount?
A. $7,560 B. $3,420 C. $1,260 D. $2,160