The Primary Benefit to the Macroeconomy of Increasing Government Spending

question 57

Multiple Choice

The primary benefit to the macroeconomy of increasing government spending is a(n)

• A)decrease in the price level.
• B)decrease in real GDP.
• C)increase in the price level.
• D)decrease in the unemployment rate.

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Definitions:

Controllable Variance

The difference between expected and actual costs that managers have the power to influence directly.

Direct Labor Rate Variance

This refers to the difference between the actual cost of labor and the expected (or standard) cost of labor used in producing goods.

Direct Labor

The cost of wages for workers who are directly involved in the production of goods or the delivery of services.

Variable Overhead Efficiency Variance

The difference between the standard cost of variable overheads allocated for actual production and the actual variable overheads incurred, used to assess efficiency in controlling variable overhead costs.