Which of the Following Factors Contributed to the Sharp Reduction

question 113

Multiple Choice

Which of the following factors contributed to the sharp reduction in aggregate demand during the Great Depression?
I. reduction in wealth
II. reduced consumer confidence
III. tax increases
IV. an expansionary monetary policy that caused inflation

• A) I and II only
• B) I and IV only
• C) I, II, and III only
• D) I, II, and IV only

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Definitions:

Budget Variance

The difference between the budgeted or planned amount of expense or revenue and the actual amount incurred or received.

Denominator Activity

The level of activity used to compute a predetermined overhead rate, representing the total amount of absorption base that is expected to be utilized.

Efficiency Variances

Refers to the differences between the actual and standard costs attributable to efficiency in using resources, often analyzed in labor and variable overhead.

Predetermined Overhead Rate

An estimated rate used to assign manufacturing overhead costs to individual units of production, based on a chosen activity base.