-As Shown in the Above Table, Sam Enjoys Sailing and Skiing

question 325

Multiple Choice

-As shown in the above table, Sam enjoys sailing and skiing equally well. Which of the following is true?

• A) Sam will not consume the same number of hours of sailing and skiing if the price per hour of sailing is more than that of skiing.
• B) If the prices per hour of sailing and skiing are the same, Sam will not spend the same number of hours at each activity.
• C) The marginal utility of the 3rd hour of either sailing or skiing is 120.
• D) None of the above is true.

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Definitions:

Direct Labor-hours

The total hours worked by employees who are directly involved in the manufacturing or production process of goods.

Predetermined Overhead Rate

A rate used to allocate manufacturing overhead costs to products, calculated based on estimated costs and activity levels.

Direct Labor-hours

The total hours worked by employees that can be directly associated with the production of goods or services.

Manufacturing Overhead

All indirect costs related to the production process, including salaries, maintenance, and utilities, not directly attributable to specific units produced.