Asked by Giansa Viola on Jul 18, 2024
Verified
If facilities have higher fixed costs,many local facilities are preferred because this helps lower transportation costs.
Fixed Costs
A type of business expense that remains constant regardless of changes in production volume or sales, such as lease payments and utility bills.
- Comprehend the compromises among fixed expenses, logistics costs, and the quantity of establishments.
Verified Answer
SF
Surala FriedmanJul 19, 2024
Final Answer :
False
Explanation :
Higher fixed costs typically lead to a preference for fewer, larger facilities to achieve economies of scale, rather than many local facilities which might not utilize these fixed costs as efficiently.
Learning Objectives
- Comprehend the compromises among fixed expenses, logistics costs, and the quantity of establishments.
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