Question detail
QuickFix Repairs serves business clients while changing promotion; the case evidence includes supplier lead time of ?9,320, sales of 175 units, and a 7% change in costs or demand. Recommend how the business should respond to Distinguish variable costs, fixed costs and total costs.
Try the question, check the answer, then read the explanation to understand the curriculum point.
At a glance
Question
Type
exam_style
Style
Topic
Financial terms and calculations
Question
QuickFix Repairs serves business clients while changing promotion; the case evidence includes supplier lead time of ?9,320, sales of 175 units, and a 7% change in costs or demand. Recommend how the business should respond to Distinguish variable costs, fixed costs and total costs.
Answer
Structure the judgement carefully. Apply total costs, variable costs, fixed costs to QuickFix Repairs serves business clients while changing promotion, then explain how the decision changes capacity utilisation, costs, revenue, cash flow, or stakeholder outcomes. A balanced response considers both the benefit and the risk for managers, uses figures such as ?12,720 or 7%, and reaches a supported judgement based on the business objective.
Explanation
Start with the business context. This explanation is anchored to Costs, revenue, profit and loss and Financial terms and calculations because it links the command word to scenario evidence, commercial reasoning, financial impact, and stakeholder consequences. It also separates revenue and profit, which helps the final judgement stay precise.
Common mistake
Costs, revenue, profit and loss common mistake 1
Giving a vague answer instead of directly addressing: Distinguish variable costs, fixed costs and total costs..
Answer by clearly explaining how to distinguish variable costs, fixed costs and total costs..
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