When the Government Hires People to Serve in the Army

question 66

Multiple Choice

When the government hires people to serve in the army, these people are no longer available to do other work. This choice illustrates the concept of

• A) marginal benefit.
• B) opportunity cost.
• C) a social interest/private interest conflict.
• D) an incentive.

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Definitions:

Standard Costing

A cost accounting method that assigns fixed overhead costs to goods produced based on standard cost rates, helping to analyze variances between expected and actual costs.

Direct Labour Hours

The total hours worked by production employees that are directly involved in the manufacturing process.

Direct Labour Efficiency Variance

The difference between the actual number of labor hours worked and the standard hours expected, multiplied by the standard labor rate.