The Unfavorable Volume Variance May Be Due to All of the Following

question 104

Multiple Choice

The unfavorable volume variance may be due to all of the following factors except

• A) failure to maintain an even flow of work
• B) machine breakdowns
• C) unexpected increases in the cost of utilities
• D) failure to obtain enough sales orders

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Definitions:

Marginal Cost

The cost added by producing one additional unit of a good or service, crucial for decision-making in business.

Advertising Revenue

Income that a company receives from advertisers for displaying or running their advertisements.

Cournot Model

An economic model used to describe an industry structure in which firms compete on the quantity of output they will produce, which they decide on at the same time.

Cournot Equilibrium

A situation in oligopoly markets where each firm chooses the quantity to produce to maximize its profit, assuming the quantities of its rivals are fixed.