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Operational decisions are short-term decisions as opposed to the longer-term strategic investment decisions that are needed when physical assets are being acquired. Some of the more common decisions related to plant operations involve material, plant facilities, and in-house capabilities of company personnel. Short term operational decisions are also called Present Economic Studies and they require the estimation of costs associated with various production and manufacturing activities. These costs provide the basis for developing successful business strategies and planning future operations. To make operational decisions it helps to understand some fundamental cost-volume relationships related to the operation of a company. A visit to the "Short-term Decisions" page will then be appropriate for a review of some common examples of short-term operational decisions. |