In the Short Run, Aggregate Demand and Aggregate Supply Shocks

question 40

Multiple Choice

In the short run, aggregate demand and aggregate supply shocks cause output gaps, which in turn, cause fluctuations in

• A)productivity.
• B)the natural rate of unemployment.
• C)factor supply.
• D)the normal factor utilization rate.
• E)the factor utilization rate.

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Definitions:

Time-Driven Activity Rate

An accounting method that assigns costs to products based on the time resources are consumed in producing the product.

Second-Stage Allocation

The process by which activity rates are used to apply costs to products and customers in activity-based costing.

Activity-Based Costing

A costing methodology that assigns expenses to products and services based on the resources they consume.

Overhead Costs

Indirect costs not directly traceable to a specific product or job, including expenses such as rent, utilities, and management salaries.