In the Absorption-Cost Approach, the Markup Percentage Covers the

question 19

Multiple Choice

In the absorption-cost approach, the markup percentage covers the

• A) desired ROI only.
• B) desired ROI and selling and administrative expenses.
• C) desired ROI and fixed costs.
• D) selling and administrative expenses only.

---

Definitions:

Technical Efficiency

The ability of an entity to maximize output for a given set of inputs, using the least possible amount of resources.

Fixed Proportion

A production scenario where inputs are used in rigid, unchanging ratios to produce outputs.

Crew Members

Individuals who work together as part of a team, especially on ships, aircraft, or in film and television productions.

Aircraft

A vehicle designed to navigate through the air.