Because Depreciation Is a Fixed Cost That Is Not Avoidable

question 22

True/False

Because depreciation is a fixed cost that is not avoidable, it is irrelevant in making an outsourcing decision.

---

Definitions:

Reserve Ratio

The fraction of depositors' balances banks must have on hand as cash, a regulatory requirement designed to ensure banks' liquidity and stability.

Inflation

The pace at which prices for goods and services broadly ascend, causing the value of money to decrease.

Federal Reserve System

The central banking system of the United States, responsible for regulating the national money supply and ensuring financial stability.

Banking Acts

Laws regulating the operation of banks, aiming to ensure stability and confidence in the financial system.