Cost Allocation Is the Assignment of ____ Costs to One

question 60

Multiple Choice

Cost allocation is the assignment of ____ costs to one or more products using a reasonable basis.

• A) yes yes
• B) yes no
• C) no no
• D) no yes

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Definitions:

SML (Security Market Line)

A line that represents the expected return of an investment as a function of its risk, with the risk measured by the investment's beta.

Zero-investment Portfolio

A portfolio that is constructed without requiring any initial capital, typically by taking long and short positions that offset each other.

Short and Long Positions

Short positions involve selling securities not owned with the hope of buying them back at a lower price, while long positions involve buying securities with the expectation that they will increase in value.

Capital Asset Pricing Model

The Capital Asset Pricing Model (CAPM) is a theoretical framework used to determine the expected return on an investment, factoring in risk and the time value of money.