Derived Demand

question 159

Multiple Choice

Derived demand:

• A)is the sum total of all factors of production for a given good or service.
• B)refers to the demand for variable inputs when at least one fixed input exists.
• C)refers to the supply decisions of a final good influencing the demand for the inputs needed to make it.
• D)is only computed for long run demand decisions based on short run marginal changes.

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Definitions:

Machining

The process of removing material from a workpiece to shape or finish it using machine tools, typically in a manufacturing or engineering setting.

Unit-level Activity

Pertains to the activities or actions that vary directly with the number of units produced or services delivered.

Product-level Activity

Activities and costs associated with a specific product, rather than with a company's operations as a whole.

Plantwide Overhead Rate

A single predetermined overhead rate that is used throughout a plant.