Wal-Mart makes bulk purchases from its vendors and hence it is able to get better deals than its competitors. This allows Wal-Mart to offer greater discounts to its customers. In this case, Wal-Mart benefits from _____.
A. first mover advantage
B. constant marginal returns
C. economies of scale
D. absolute advantage of production
Answer: C. economies of scale
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The formal written agreement for issuing bonds is called a bond:
a. redemption. b. debenture. c. series agreement. d. premium. e. indenture.
Why is experimentation required?
a. to meet the requirements of investors and loan officers b. to generate ideas that can be used in further business development c. to make sure that entrepreneurs have the right assumptions about meeting the demands of potential customers d. to form hypotheses about customer behavior towards their product or service
Which of the following statements is true regarding variable costing?
A. Only manufacturing costs that change in total with changes in production level are included in product costs. B. It makes it easier to manipulate earnings with changes in production levels. C. It is not permitted to be used for managerial reporting. D. It treats overhead in the same manner as absorption costing. E. It is a traditional costing approach.
Stefanovich Corporation makes one product. The company has provided the following information concerning its raw materials needs:•The ending raw materials inventory should equal 20% of the following month's raw materials production needs. •Each unit of finished goods requires 2 pounds of raw materials. •The raw materials cost $3.00 per pound. •The company will need 26,440 pounds of raw material to satisfy production needs in March. The raw materials inventory balance at the end of February should be closest to:
A. $14,568 B. $74,136 C. $15,864 D. $88,704