Why is it important that decision makers in a corporation know the cost function for producing the companies' products?
Decision makers should know a product's cost function if their
decisions affect the amount of product produced. To know the cost
impact of their decisions, decision makers apply the cost function
to each possible volume of production. This is important in many
decisions, such as pricing decisions, promotion and advertising
decisions, sales staff deployment decisions, and many more
decisions that affect the volume of product that the company
produces.