In the Three-Factor Fixed Effects Model, Assume That There Are

question 48

Multiple Choice

In the three-factor fixed effects model, assume that there are 4 levels of factor A, 2 levels of factor B, 4 levels of factor C, and 3 observations for each combination of levels of the three factors. Then, the number of degrees of freedom for the three-factor interaction sum of squares (SSABC) is

• A) 32
• B) 10
• C) 9
• D) 12
• E) 13

---

Definitions:

Variable Overhead Rate Variance

The difference between the actual variable overheads incurred and the expected variable overheads based on standard rates.

Labor Rate Variance

The difference between the actual labor rate paid and the standard rate expected, multiplied by the total hours worked.

Labor Efficiency Variance

The variance between the real hours spent producing a good or service and the anticipated standard hours, times the standard wage rate.

Variable Overhead Rate Variance

The difference between the actual variable overhead costs incurred and the standard variable overhead expected for the actual production achieved.