Refer to the Information Provided in Figure 9

question 12

Multiple Choice

Refer to the information provided in Figure 9.2 below to answer the question(s) that follow. Figure 9.2
-Refer to Figure 9.2. Suppose demand for wheat is initially D₂. If consumer incomes decrease, then demand for wheat will shift to ________. This will ________ the equilibrium price of wheat and individual profit-maximizing firms will produce ________ bushels of wheat.

• A) D₃; increase; 15
• B) D₁; increase; 10
• C) D₃; decrease; 7
• D) D₁; decrease; 0

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Definitions:

Material Price Variances

The difference between the actual cost of materials and the expected or budgeted cost of materials in production processes.

Materials Account

An account used to track the costs of raw materials that are either in stock or being used in production processes.

Standard Cost

A predetermined cost of manufacturing a product or providing a service, used for budgeting and performance evaluation.

Labour Rate

The amount of money paid to workers for their services, typically expressed as an hourly wage.