At 23 Years, Miguel Has Substantial Student Loan Debt

question 41

Multiple Choice

At 23 years, Miguel has substantial student loan debt. He has found a job in his field and has begun to make payments on this debt. He would like to pay this off as soon as possible, so he has decided to move back in with his parents until the debt is paid off. Miguel is an example of a ______.

• A) homogamous child
• B) shared household
• C) boomerang child
• D) shotgun cohabitation

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Definitions:

Variable Costs

Costs that vary directly with the level of production or volume of output, such as raw materials and labor directly involved in manufacturing.

Activity Levels

A measure used in cost accounting to evaluate the relation between the cost of a particular activity and the level of activity executed.

Operating Leverage

A measure of how revenue growth translates into growth in operating income, determined by the proportion of fixed versus variable costs a company has.

Contribution Margin

The difference between sales revenue and variable costs, indicating how much contributes towards covering fixed costs and generating profit.