Marked benefits arise when EDI is tied to strategic efforts that alter, not mirror, previous practices. Applying EDI to an inefficient process results in continuing to do things the wrong way, only faster. Hence, the initial phase of EDI implementation includes understanding the organization's mission and an analysis of its activities as part of an integrated solution to the organization's needs.

The interest payments on indexed or purchasing power bonds are based on an inflation index, such as the consumer price index. Thus, interest paid to bondholders rises automatically when the inflation rate rises.

An object-oriented approach is intended to produce reusable code. Because code segments can be reused in other programs, the time and cost of writing software should be reduced.

The contribution margin equals revenues minus variable costs. The CMR equals the UCM divided by the selling price. For example, if variable costs average US $10 per unit, the average selling price is US $16 $1.60 x $10). However, the 10% markdown implies that the actual average selling price is US $14.40 .90 x $16). The CMR is therefore 30.6% [ US $14.40 - $10.00) - $14.40]. A company that sells its single product for US $40 per unit uses cost-volume-profit analysis in its planning. The company's after-tax profit for the past year was US $1,188,000 applying an effective tax rate of 40%. The projected costs for manufacturing and selling its single product in the coming year are listed.