Post Utme Igbinedion University 2018 Commerce Question 29

Practice objective / multiple choice question 29 from the 2018 Post Utme Igbinedion University Commerce examination.

Post Utme Igbinedion University 2018 Commerce Objective / Multiple Choice
Question 29 POST_UTME_IGBINEDION_UNIVERSITY • 2018 • COMMERCE • objective

A firm is considering the introduction of a new product line. The production manager has estimated that the cost of producing the product will be ₦100 per unit in the first year, increasing by 15% each year for the next 5 years. If the company wants to minimize its costs, which of the following production strategies should it adopt?

Answer Options

A. Increase the production level by 10% each year
B. Decrease the production level by 10% each year
C. Maintain the same production level throughout the 5-year period
Correct Answer D. Increase the production level by 20% in the first year and maintain it at that level for the next 4 years
Correct Answer
D
Correct Option:
Increase the production level by 20% in the first year and maintain it at that level for the next 4 years

About This Question

This is Post Utme Igbinedion University 2018 Commerce Question 29. It is one of the objective questions from the 2018 Post Utme Igbinedion University Commerce examination.

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