Exhibit 5A-2 -Refer to Exhibit 5A-2. If the Individual Starts at Point

question 104

Multiple Choice

Exhibit 5A-2
-Refer to Exhibit 5A-2. If the individual starts at point A and moves to point B as a result of an increase in the price of Y, then the amount of reduction in the consumption of Y is

• A)45 due to the substitution effect and 25 due to the income effect.
• B)25 due to the substitution effect and 20 due to the income effect.
• C)25 due to both the substitution effect and income effect.
• D)20 due to the substitution effect and 25 due to the income effect.
• E)25 due to the substitution effect and 45 due to the income effect.

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Definitions:

Internal Reports

Reports generated within an organization, intended for internal strategic decision-making and performance evaluation.

Labor Price Variance

The difference between the actual cost of labor and the standard or budgeted cost of labor over a period.

Direct Labor Cost

The total cost of work done by employees who are directly involved in the manufacture of a product or in performing a service.

Balanced Scorecard Approach

A strategy performance management tool that incorporates financial and non-financial performance indicators to provide a more comprehensive view of an organization's health.