If the Equilibrium Output Is Below Potential Output

question 20

Multiple Choice

If the equilibrium output is below potential output:

• A) the price level decreases.
• B) unemployment is constant.
• C) aggregate demand increases.
• D) inflation usually rises.

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Definitions:

Manufacturing Costs Assigned

Direct and indirect expenses attributed to the production of goods.

Job Cost Sheets

A document used to record and track the expenses associated with a specific job or project, aiding in the calculation of its total cost.

Predetermined Overhead Rate

An estimated rate used to allocate manufacturing overhead to individual products or job orders based on a consistent measure, such as direct labor hours.

Total Manufacturing Costs

The aggregate of all expenditures involved in the production of goods, including materials, labor, and overhead expenses.