The sum of all costs incurred in all business functions in the value chain (marketing, customer service, product design, and manufacturing, for example) is known as
A) business cost.
B) full product cost.
C) gross product cost.
D) multiproduct cost.
E) incremental cost.

Question

Quizplus · Accepted Answer

The full product cost includes all costs incurred in all business functions in the value chain, including marketing, customer service, product design, and manufacturing. Thus, option B, full product cost, is the correct choice. Option A, business cost, is too broad and does not specifically refer to the sum of costs in the value chain. Option C, gross product cost, refers only to the total revenue minus the cost of goods sold, which is not the same as the sum of all costs incurred in the value chain. Option D, multiproduct cost, and option E, incremental cost, are not relevant to the given concept.

The Sum of All Costs Incurred in All Business Functions