Regarding Economic Models, Which of the Following Statements Is NOT

question 169

Multiple Choice

Regarding economic models, which of the following statements is NOT true?

• A)An economic model is a simplified representation of a theory or part of a theory.
• B)An economic model can provide clear answers for policy makers.
• C)An economic model can clarify an important economic problem.
• D)An economic model can show three-variable diagrams.

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Definitions:

Estimated Overhead Cost

The projected costs of indirect materials, labor, and other expenses that are necessary for production but cannot be directly associated with specific product units.

Direct Labour-Hours

A measure of the amount of time workers spend directly manufacturing a product or providing a service.

Traditional Costing System

A traditional costing system allocates factory overhead to products based on volume-related measures such as direct labor hours or machine hours.

Overhead Cost Per Unit

This is the amount of indirect costs allocated to each unit of production, including costs not directly tied to the production like rent and utilities.