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Operating below full capacity raises operating costs and can lead to:
ASickness and closure
BSudden expansion up
CHigher export sales
DLower selling prices
Answer & Solution
Correct answer: A. Sickness and closure
1. Demand or marketing skill may be lacking.
2. Costs per unit climb.
3. That gradually leads to sickness and closure.
_Source: NCERT Class 11 Business Studies, Chapter 9, Small Business and Entrepreneurship._
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