In nonlinear optimization models, the change in the optimal objective function value per unit increase in the right-hand side of that constraint is called

Q: Assume that a straight line on a CVP chart intersects the vertical axis at the level of fixed costs…

A: CVP Chart:   Cost Volume Chart (CVP) chart refers to a graphical representation of the cost-volume…

Q: The concept of operating leverage involves the use of __________ to magnify returns at high levels…

A: Introduction: Usually, an operating leverage is a measure of the extent to which a mixture of the…

Q: The increase/decrease in variable cost from existing level to the new level is called as __cost. a.…

A: Variable cost tends to increase or decrease with increased or decreased volume of production whereas…

Q: Fixed Costs imply that the divisibility assumption of linear models no longer holds? True or False?…

A: Divisibility Assumption: Decision variables in a linear programming model are allowed to have any…

Q: Another of Matilda’s colleagues is looking at the yield curve and asks for an explanation as to why…

A: Biased expectation theory is defined as the theory of term structure of the rate of interest. In the…

Q: Which of the following statements is correct: A. total fixed cost remain constant while variable…

A: Fixed Costs: Total Fixed cost remains constant at all the level of activities. Fixed cost per unit…

Q: High-low and regression cost estimation methods are alike in that they both: Select one: O a. Have a…

A:

Q: Give an example of how a manager can decrease variable costs while increasing fixed costs?

A: Variable Cost: Variable costs are costs which are directly vary with the change in production.…

Q: If the real cost of hedging is ______, then the hedging strategy was beneficial.   Group of answer…

A: Real Cost of Hedging: The real cost of hedging payables is the sum of the cost of hedging payables…

Q: Based on the following sensitivity report, what would be the impact of changing the constraint…

A: In Linear Programming Problem, there is a tab which gives out the sensitivity analysis, which helps…

Q: Which of the following cost behavior assumptions is true? (You may select morethan one answer.)a.…

A: Variable cost: The cost which changes according to the level of activity. These are not fixed in…

Q: When variable costs increase and all other variables remain unchanged, the break-even point will…

A: The break even point is incurred when all the costs are covered by the sales and there is no profit…

Q: To increase margin of safety, the following measures can be taken O a. Increase the output O b.…

A: The margin of safety is the excess of current sales over break even sales.

Q: Within the relevant range, if there is a change in the level of the cos a. Total fixed costs and…

A: Fixed cost will change and total cost will remain the same.

Q: The “line of best fit” may also be described as: a.the total variable cost line b.the total fixed…

A: Variable cost- A variable cost is a commercial expense that changes in amount to how much a…

Q: From the information given in the preceding question (in which Ming views X and Y as perfect…

A: Perfect complementary good is a good that must be consumed with another good. These goods can be…

Q: Which of the following statements related to CVP chart is not true? a. None of the given answers. O…

A: Cost volume profit chart is the chart which shows total cost line, total revenue and profit for all…

Q: CVP analysis using activity-based costs will tend to shift some costs from fixed to variable…

A: CVP Analysis:   CVP analysis establishes the relation between cost, volume and profit of the…

Q: What is the difference between a linear and a nonlinear cost function? Give an example of each type…

A: Cost Function:Cost function represents the basic change comes in the total cost due to the change in…

Q: The value of any model is that it enables the user to make inferences about the real situation.…

A: The values derived from the model are useful for important hypothesis and is relevant in many…

Q: In making a short-term special decision, which of the following is MOST important? a. Use a…

A: Solution Concept The decision that is to be taken differs from one another on the basis of the time…

Q: Please explain thoroughly the statement below. (True/false), how and why?  "When expressed on a…

A: POINTS TO BE NOTED -    ** Fixed cost will remain constant irrespective of change in the level of…

Q: What happens if we wish to increase a constraint RHS value beyond the allowable increase/decrease…

A: Sensitivity analysis is referred to as the study of uncertainty in the mathematical model output or…

Q: When fixed costs increase and all other variables remain unchanged, the contribution margin will…

A: Contribution margin is the difference of sales price per unit and variable cost per unit.

Q: 2) Which of the following techniques is not used to analyze cost behavior? A) Least-squares…

A: Cost Accounting: It is the process of collecting, recording, analyzing the cost, summarizing cost,…

Q: When fixed costs increase and all other variables remain unchanged, the contribution margin will…

A: The bteak even sales are the sales where business earns no profit no loss during the period.

Q: When the level of activity increases, total fixed costs a. decrease. b. remain the same. c.…

A: Costing: Costing is a technique used in cost accounting to determine the cost of a product. With…

Q: Which of the following statements related to cost estimation methods is true? The low-high method is…

A: All four methods of cost estimation has its own pros and cons. For quick estimate requirement,…

Q: When variable costs increase and all other variables remain unchanged, the break-even point will…

A: Break even point is that point at which business is recovering its fixed costs and variable costs.…

Q: PLEASE ANSWER ALL Write “True” if the statement is true and write “False” if the statement is…

A: Variable costs are those costs that changes with change in level of activity. Fixed costs are costs…

Q: Give an example of how a manager can increase variable costs while decreasing fixed costs?

A: Fixed costs refers to those which do not change according to the change in units of productions.…

Q: Show how each of these costs will behave as the volume of activity decreases.…

A: The volume of activity directly impacts the variable cost because the variable cost changes directly…

Q: When should a segment be dropped?

A: Any Segment will be dropped only when  there is increase in the Net operating income after the…

Q: In using least-squares to estimate the variable and the fixed components in a mixed cost, these two…

A: Least Square method (Linear regression) is a very accurate method for dividing cost into variable…

Q: Give an example how a manager can increase variable cost while decreasing fixed costs

A: Cost behavior: Cost behavior is the relationship between cost and activity and it is relevant to the…

Q: Which of the following is true about the hypothesis test of cost parameters? a) It indicates whether…

A: Hypothesis testing refers to the form of inferable statistics which allows us in making conclusions…

Q: get costing is reversal of: a. Marginal cost b. Skimming pricing c. Penetrating pricing d. Cost plus…

A: Solution: Target costing is reversal of Cost plus model. This is because under target costing cost…

Q: Explain why cost predictions based on the same cost driver can differ when applying the high-low…

A: The High-low method is a cost computation technique that separates variable and fixed cost from…

Q: Accepting a special order will improve overall net operating income if the revenue from the special…

A: Variable costs are the costs which change with change in output. Sunk costs are the costs which are…

Q: When planning and predicting costs at other volumes using a cost equation derived from either…

A: Cost equation is the equation which is expressed as the mathematical formula used by the companies…

Q: Give an example how manager can decrease variable cost while increasing fixed cost

A: Cost behavior: Cost behavior is the relationship between cost and activity and it is relevant to the…

Q: Which of the following is correct concerning reactions to INCREASES in activity? Total Variable Cost…

A: In the question we are required to identify the effect of increase in activity on Total Variable…

Q: Define a nonlinear cost function.

A: Cost Function: Cost function represents the basic change that comes in the total cost due to the…

Q: Relevant costs for target pricing are​ ________.   A. variable manufacturing costs   B. variable…

A: Relevant costs are the costs which are computed to take pricing decisions. These costs include the…

Q: When variable costs increase and all other variables remain unchanged, the break-even point will: a.…

A: Break even point is that point at which business is recovering its fixed costs and variable costs.…