Explain the Difference Between Real and Nominal Output

question 57

Essay

Explain the difference between real and nominal output.Explain how they are related.

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Definitions:

Budgeted Contribution Margin

The anticipated difference between sales revenue and variable costs in a budget period.

Variable Overhead Efficiency Variance

The difference between the actual variable overhead incurred and the standard cost of variable overhead allotted for the actual production.

Indirect Materials

Materials used in the production process that are not directly part of the final product, such as lubricants for machines.

Unfavourable Variance

A financial term referring to a situation where actual costs are higher than planned or budgeted costs, or actual revenue is lower than forecasted revenue.