Although products are initially sold at a loss, under life cycle costing managers usually expect:
I. Sales volume increases for the product or related products over time
II. A shift to a commodity market over time
III. Cost reductions over time
A) I and II
B) II and III
C) I and III
D) I, II, and III

Question

Quizplus · Accepted Answer

Under life cycle costing, managers expect sales volume to increase for the product or related products over time, as well as cost reductions over time. However, there is no expectation for a shift to a commodity market over time. Therefore, only options I and III are valid.

Although Products Are Initially Sold at a Loss, Under Life