Suppose There Is a Real Appreciation in Favour of Australia

question 67

Multiple Choice

Suppose there is a real appreciation in favour of Australia. Which of the following must have occurred?

• A) Foreign currency has become more expensive in Australian dollars.
• B) The foreign price level has increased relative to the Australian price level.
• C) Foreign goods have become more expensive to Australians.
• D) Foreign goods have become less expensive to Australians.
• E) Foreign currency has become less expensive in Australian dollars.

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Definitions:

Variable Component

A cost associated with the production of goods or services that varies with the level of output or sales.

Predetermined Overhead Rate

A rate calculated before the accounting period begins, used to apply manufacturing overhead costs to products by estimating fixed and variable manufacturing overhead costs for the coming period.

Predetermined Overhead Rate

A rate used to allocate manufacturing overhead to individual units of production, based on estimated costs.

MH

Often used as an abbreviation for "machine hours," representing the amount of time machines are operated in the production process.