If Demand and Supply Both Shift to the Right, Then

question 2

Multiple Choice

If demand and supply both shift to the right, then:

• A) both price and quantity will go up.
• B) price will go down and quantity will go up.
• C) quantity will go down and price will go up.
• D) quantity will go up, but price could go up, down, or stay the same

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Definitions:

Activity-Based Costing

A costing methodology that assigns manufacturing and non-manufacturing costs to products or services based on the activities needed to produce them.

Machine-Hours

A measure of the amount of time machines are used in the production process, often used as a basis for allocating manufacturing overhead.

Overhead Cost

Expenses related to the ongoing operation of a business that cannot be directly traced to a specific product or service, like rent, utilities, and insurance.

Activity-Based Costing

A method of costing that apportions overhead and indirect expenditures to products and services related to the activities they entail.