Which of the Following Statements Is Correct About the Economic

question 202

Multiple Choice

Which of the following statements is correct about the economic way of thinking?

• A) If the buyer of a good gains, the seller must lose an equal amount.
• B) The value of goods is objective; it is equal to the cost of supplying the good.
• C) Opportunity costs will always be incurred when scarce resources are used to produce a good.
• D) Changes in incentives generally have no effect on human behavior.

---

Definitions:

Split-Off Point

The stage in a production process where joint products can be recognized as separate products.

Constant Gross Margin Method

A pricing strategy where the gross margin percentage is kept constant despite variations in product costs.

Joint Cost Allocation

The process of assigning the cost of a production process that yields multiple products proportionally to those products.

Activity-Based Costing

A costing method that identifies activities in an organization and assigns the cost of each activity to all products and services according to the actual consumption.