All of the Following Are Examples of an Economic Variable

question 17

Multiple Choice

All of the following are examples of an economic variable except

• A)the amount of income tax that a household has to pay.
• B)a family's income.
• C)the price of gasoline.
• D)an integer 24.
• E)the number of oil refineries in the United States.

Recognize external failure costs from a schedule of activity costs.

Analyze the effects of batch size changes on value-added, non-value-added, and total lead times.

Understand the components of a cost of quality report including prevention and appraisal costs.

Compute the percentage of non-value-added activities.

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Definitions:

Opportunity Cost

The cost of an alternative that must be forgone in order to pursue a certain action, the benefits you could have received by taking an alternative action.

Marginal Cost

The cost added by producing one more item of a product, a crucial factor in economic decision-making regarding production levels.

Economic Profit

The difference between a firm’s total revenues and its total costs, including both explicit and implicit costs, representing the actual financial gain.

Accounting Profit

The total revenue of a business minus its explicit costs, reflecting the financial gain as recorded in the financial statements.