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Question
Vinod started a bread factory. He decided that he can reduce the cost involved in production if he produced in large quantities. Which principle is evident in this situation?
[0.80 marks]
Vinod started a bread factory. He decided that he can reduce the cost involved in production if he produced in large quantities. Which principle is evident in this situation?
[0.80 marks]
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Solution
The correct option is A The production concept
Every organisation should decide the philosophy or thinking that should guide its marketing efforts. One such philosophy is the production concept. This concept implies that the focus of business activities should be on production of goods. Firms believe that profits can be maximised by producing on a large scale. This in turn would reduce the average cost of production. Additionally, it is assumed that consumers favour the products that are widely available at an affordable price.
Every organisation should decide the philosophy or thinking that should guide its marketing efforts. One such philosophy is the production concept. This concept implies that the focus of business activities should be on production of goods. Firms believe that profits can be maximised by producing on a large scale. This in turn would reduce the average cost of production. Additionally, it is assumed that consumers favour the products that are widely available at an affordable price.
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