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The reason why the father wished to close down the branch was that it appeared to be making a loss. However, it is quite the reverse; if the branch was closed then, the positive contribution from the branch would be lost and overall profits would fall.
This is because the indirect costs of production do not vary with output and, therefore, closure of a section of the firm would not lead to immediate savings.
This may mean that closing the branch would be a mistake on financial grounds.
This mistake is made due to a misunderstanding of nature of cost behavior. If the branch is closed then the only costs that would be saved are the costs directly related to the running of the branch: The costs are indirect in nature, in this example the marketing and central administration costs, would still have to be paid as they are unaffected by output.
For this decision to be made, we should use contribution as a guide for deciding whether or not to close a branch. This can also be applied to the production of certain product lines, or the cost effectiveness of departments.
On financial grounds, contribution is therefore, a better guide in making decisions.A carefully prepared and well written book Without doubt, it can be recommended as a very valuable encyclopedia and textbook for a reader who is looking for a mainly theoretical textbook which combines traditional time series analysis with a review of recent research yunusemremert.coml of Economics.
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Invented by Thomas Marban. Time management is the process of planning and exercising conscious control of time spent on specific activities, especially to increase effectiveness, efficiency or yunusemremert.com is a juggling act of various demands of study, social life, employment, family, and personal interests and commitments with the finiteness of time.
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"Analysis of financial time series, third edition, is an ideal book for introductory courses on time series at the graduate level and a valuable supplement for statistics courses in time series at the upper-undergraduate level."Mathematical Reviews. Zacks is the leading investment research firm focusing on stock research, analysis and recommendations.
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