Question

Which of the following types of product modifications inevitably tend to cause firms to reduce costs in some of the organization?

a) Aesthetic
b) Operational
c) Benefit
d) Functional
e) Quality

Answer 1

An improvement in technology, product quality, and operational efficiency can lead to cost reduction for organizations.

Step-by-step explanation:

An improvement in technology that reduces the cost of production will cause an increase in supply, leading to a reduction in costs for the organization. This can be shown as a rightward (or downward) shift in the supply curve.

An improvement in product quality can also lead to a reduction in costs for the organization. When consumers demand more of a higher-quality product, it can increase the overall demand and shift the demand curve to the right, creating opportunities for economies of scale and cost reduction.

Operational modifications can also result in cost reduction for the organization. By improving operational efficiency and streamlining processes, firms can eliminate waste, reduce production costs, and increase profitability.