The Major Disadvantage of the High-Low Method Is That

question 53

Multiple Choice

The major disadvantage of the high-low method is that:

• A) It uses the two most extreme data points in determining a cost function
• B) It is difficult to calculate
• C) It is difficult to understand
• D) It involves more judgmental factors than do other methods

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Definitions:

Full Employment

An instance in which all obtainable labor forces are deployed in the most economically advantageous way.

Consumer Price Index

An indicator of inflation that looks at the weighted average costs of a collection of consumer goods and services.

Savers

Individuals or entities that set aside funds rather than spending them, typically to accumulate wealth for future use.

Creditors

Creditors are individuals or institutions to whom money is owed by another individual or entity, typically resulting from a loan or credit extended.