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Illustration of Marginal profit To illustrate the computations, suppose that the marginal profit or XE in our model is changed from 3 to 3 + δ1, where δ represents either posit
Techniques of CVP Analysis The CVP analysis deals with the price costs structure and the sales volume and identifies the profit figure with one or other combination of these
Introduction to Performance Evaluation Performance evaluation deals with the area of MA that is concerned with: 1) Holding individual managers responsible for certain aspect
Correlation coefficient (r) Correlation coefficient measures the degree of association between two variables such as the cost and the activity level. r = nΣxy - Σx Σy
Independence of observations An important assumption for the simple linear regression model is the independence of errors. In many time series models, this assumption is violat
At the starting of the year, Asquith Company Ltd initiated a quality improvement program. The program was successful in decreasing scrap and rework costs. To help assess the impact
Minimal Regret Criterion : This method seeks to minimize the maximum regret that would occur from choosing a particular strategy or alternative. The regret is the opportunit
Definition of accounting Accounting is the procedure of recognizing measuring and communicating economic information to allow informed judgments and decisions by the user’s inf
Markov Properties 1) Transition probabilities are dependent only on the current state of the system i.e. provided that the current state is recognized; the conditional probabil
CVP ANALYSIS AND COMPUTER APPLICATIONS The output from a CVP model is only as good as the input. The analysis will include assumptions about sales mix, production efficiency, p
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