Use the Table Below to Answer the Following Questions

question 86

Multiple Choice

Use the table below to answer the following questions.
Table 6.5.1
The Market for a Prohibited Good
-Refer to Table 6.5.1.If a $2-per-unit cost of breaking the law is imposed on both the buyers and the sellers,the new price is ________ and the new equilibrium quantity is ________ units.

• A)$8;400
• B)$8;300
• C)$7;300
• D)$9;300
• E)$8;200

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Definitions:

Materials Price Variance

The difference between the actual cost of materials purchased and the standard cost of those materials.

Materials Usage Variance

The difference between the standard quantity of materials expected to be used in production and the actual quantity used, valued at the standard cost for the materials.

Standard Cost

A predetermined cost of manufacturing a single unit or a number of product units during a specific period under current or anticipated conditions.

Standard Hours

The set number of hours that is expected to be used to complete a certain task or job in a manufacturing or project setting.