The Major Factor That Determines the Volume of Savings, Corporate

question 104

Multiple Choice

The major factor that determines the volume of savings, corporate as well as individual, is the:

• A) volume of spending
• B) level of national income
• C) amount of private pension plans
• D) amount of life insurance policies

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Definitions:

Unit Variable Expenses

Costs that vary directly with the production volume, calculated on a per-unit basis.

Fixed Expenses

Costs that do not vary with the level of production or sales, such as rent, salaries, or utilities.

Profit

The financial gain achieved when the revenues generated from business activities exceed the expenses, costs, and taxes needed to sustain those activities.

Margin Of Safety

The extent to which sales can decline before a business reaches its breakeven point.