Question

Which of the following statements is true of flexible resources?

a. They are not fully utilized and always have unused capacity.
b. The quantity of the resource supplied is more than the quantity demanded.
c. They are supplied as used and needed.
d. The cost of a flexible resource is a fixed cost.

Answer 1

The true statement about flexible resources is that they are supplied as used and needed, adjusting to the production demands and constituting a variable cost for a company.

Step-by-step explanation:

The statement that is true of flexible resources is: c. They are supplied as used and needed. Flexible resources differ from fixed ones because flexible resources can be adjusted according to the production needs. If the demand for a company's products increases, the company can order more of the flexible resource to increase production. Conversely, if demand falls, the company can reduce orders for the flexible resource, thus lowering its variable costs. This makes the cost of a flexible resource a variable cost, not a fixed cost. Fixed costs, such as rent and salaried labor, cannot be altered in the short term and are often considered sunk costs that cannot be recuperated.