大全-1-17

bobochener

17.   Companies considering new cost-cutting manufacturing processes often compare the projected results of making the investment against the alternative of not making the investment with costs, selling prices, and share of market remaining constant.

Which of the following, assuming that each is a realistic possibility, constitutes the most serious disadvantage for companies of using the method above for evaluating the financial benefit of new manufacturing processes?

(A) The costs of materials required by the new process might not be known with certainty.

(B) In several years interest rates might go down, reducing the interest costs of borrowing money to pay for the investment.

(C) Some cost-cutting processes might require such expensive investments that there would be no net gain for many years, until the investment was paid for by savings in the manufacturing process.

(D) Competitors that do invest in a new process might reduce their selling prices and thus take market share away from companies that do not.（D）

(E) The period of year chosen for averaging out the cost of the investment might be somewhat longer or shorter, thus affecting the result.


不理解，觉得C更好


——进行CR的过程……唉。

sayysong

个人理解是C说明了disadvantage of investment, not of using the method above for evaluating the financial benefit. B成立的条件是假定  investment 是借的钱, 所以利息才会影响cost. 不知道正确不?

arthurman

why B is wrong??

cost changed in B as well...

bobochener

Get it,thaks

swlfxer

Did you see that the methos mentioned in the question requires that the market share be constant? D points out that the market share is likely be change. Therefore the approach mentioned in the question does not fit.