Which of the below statements is FALSE?
A)Whenever a new product competes against a company's already existing products and reduces the sales of other products,opportunity costs occur.
B)Erosion can provide cost savings.
C)A synergy gain occurs when a new product can be introduced that complements another current product so that sales for this current product increases.
D)Increases in working capital accounts necessary to support a project add upfront costs,but also provide for cost reductions at the end of the project.

Question

Quizplus · Accepted Answer

Opportunity costs represent the benefits an individual, investor, or business misses out on when choosing one alternative over another. The statement about opportunity costs occurring when a new product competes against a company's already existing products and reduces the sales of other products is incorrect. This scenario describes cannibalization, not opportunity costs. Opportunity costs are about the foregone benefits from the next best alternative, not the direct impact of one product on the sales of another within the same company.

Which of the Below Statements Is FALSE