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If a test has low predictive validity, then
Predetermined Overhead Rate
An estimated rate used to allocate manufacturing overhead to individual units of output.
Capacity
The maximum level of output that a company can sustain to make a product or provide a service, influenced by available resources and constraints.
Machine-Hours
The total hours a machine is operated within a given period, often used to allocate manufacturing overhead.
Unused Capacity
The difference between a company's actual production and its maximum potential production if all resources were fully utilized.
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