Rhonda runs a small street vendor service that contracts to produce and sell moulded plastic souvenirs (key chains,commemorative plastic coins,plastic animals,etc.) at small fairs.As owner of the firm,Rhonda must decide how much of each product to produce.What is a key element of this decision
A)how costs will vary as she changes the level of production
B)the cost of bookkeeping services
C)the fixed cost of production
D)the cost of his vending booth

Question

Quizplus · Accepted Answer

The key element in Rhonda's decision-making process is how costs will vary as she changes the level of production. This is because Rhonda needs to ensure that she produces enough of each product to meet demand while minimizing her costs to maximize profits. By understanding how costs will change with varying levels of production, Rhonda can make informed decisions about the quantity of each product to produce. The cost of bookkeeping services, the fixed cost of production, and the cost of her vending booth are all important considerations, but they are secondary to understanding how costs will vary with production levels.

Rhonda Runs a Small Street Vendor Service That Contracts to Produce