An Unrealistic Budget Is More Likely to Result When It

question 8

Multiple Choice

An unrealistic budget is more likely to result when it

• A) has been developed in a top down fashion.
• B) has been developed in a bottom up fashion.
• C) has been developed by all levels of management.
• D) is developed with performance appraisal usages in mind.

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Definitions:

Complementary Goods

Products and services that are used together. When the price of one falls, the demand for the other increases (and conversely).

Income Elasticity

A measure of how much the demand for a good or service changes in response to a change in consumers' income.

Inferior Good

A type of good for which demand decreases as the income of consumers increases, conversely, demand increases when consumer income decreases.

Cross Elasticity

Cross elasticity of demand quantifies how the demand for a good or service is affected by the price change of another related good, reflecting their substitutability or complementarity.