Because There Is a Trade-Off Between Total Output and Equality

question 3

Multiple Choice

Because there is a trade-off between total output and equality of income distribution,

• A)greater equality of distribution will generally result in higher levels of output.
• B)greater output is generally associated with more equal distribution.
• C)policies designed to increase output will only succeed if distribution is more equal.
• D)policies intended to expand output must necessarily fail.
• E)policies designed to equalize distribution may adversely affect the size of output.

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Definitions:

Cost Behaviours

Describes how different types of costs change or remain constant with variations in business operations' volume or scale.

Contribution Margin

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

Variable Selling Expenses

Expenditures that change in direct correlation with the amount of sales, like commission fees and delivery costs.

Fixed Selling Expenses

Costs related to selling that do not change with the level of sales, such as salaries of sales staff and rent for sales space.