Question: Managers often have to choose between mutually exclusive alternatives. The first the alternatives and the relevant revenues and costs of each option. The next step

Managers often have to choose between mutually exclusive alternatives. The first the alternatives and the relevant revenues and costs of each option. The next step the alternatives. This is called differential analysis, or incremental analysis. The determine the differential income or loss from choosing one option over the other. are included in one option, the cost should also be included in the other options purposes. Make or buy decisions, sell or process further decisions, lease or buy decisions, wh an order at a discounted price, and when to replace equipment, are all examples o decisions where differential analysis is used

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