An Outward Shift of the Production Possibilities Frontier

question 83

Multiple Choice

An outward shift of the production possibilities frontier

• A)reflects economic stability
• B)reflects economic growth
• C)reflects economic decline
• D)does not relate to the state of the economy
• E)is always a parallel shift

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Definitions:

Standard Fixed Overhead Cost

The predetermined amount of fixed costs that are expected to be incurred to support operations, typically fixed for a specific period.

Direct Materials Quantity Variance

The difference between the actual quantity of materials used in production and the expected quantity, multiplied by the standard cost per unit.

Price Variance

The difference between the expected price and the actual price paid for an item.

Factory Overhead Volume Variance

The difference between the budgeted and actual overhead costs due to variations in the volume of production.