Which of the Following Statements Is False

question 186

Multiple Choice

Which of the following statements is false?

• A) In a free-market system, the basic economic questions are answered without the help of a central government plan or directive.
• B) Individuals guided by their own self-interest will produce products and services that other people want.
• C) The basic coordinating mechanism in a free-market system is quantity adjustments toward equilibrium.
• D) In a free-market system, competition forces firms to adopt efficient production techniques.

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Definitions:

Activity-Based Costing

An accounting method that assigns costs to products or services based on the activities and resources that go into producing them.

Overapplied

A situation where the allocated costs exceed the actual costs incurred.

Underapplied

Refers to a situation where the allocated costs are less than the actual costs incurred.

Factory Overhead

The indirect costs of manufacturing, such as salaries of quality control personnel and depreciation of factory equipment.