Refer to the Above Diagram

question 209

Multiple Choice

Refer to the above diagram.Automatic stability in this economy could be decreased by:

• A)shifting the government expenditure line upward but parallel to its current position.
• B)changing the tax system so that the tax line is shifted upward but parallel to its present position.
• C)changing the government expenditures line so that it has a negative slope.
• D)changing the tax system so that the tax line has a flatter slope.

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Definitions:

Cost Per Equivalent Unit

A calculation used in process costing that determines the cost associated with a single unit of output, adjusting for partial completion of units in the production process.

Materials Cost

The cost of raw materials used to produce goods.

Process Costing

A method of costing that is used in industries where production is continuous and the product is indistinguishable from unit to unit.

Equivalent Units

A concept used in cost accounting to represent the amount of work done on partially finished goods, converted into the number of fully finished units.