When transportation costs are added to production costs, it becomes unprofitable to ship some products over a large distance.This is particularly true of products that have a:
A)high value-to-weight ratio
B)moderate value-to-weight ratio
C)low value-to-weight ratio
D)extremely high value-to-weight ratio
E)value to weight ratio

Question

Quizplus · Accepted Answer

Products with a low value-to-weight ratio are less expensive but are also heavier, which means that transportation costs will make up a larger percentage of the total cost. Therefore, it becomes unprofitable to ship them over a long distance. Products with a high value-to-weight ratio are generally more costly but are also lighter, which means that transportation costs are a smaller percentage of the total cost and thus can be transported over a long distance.

When Transportation Costs Are Added to Production Costs, It Becomes