If the Activity Level Decreases, What Happens to the Unit

question 2

Multiple Choice

If the activity level decreases, what happens to the unit fixed cost?

• A)It decreases.
• B)It increases.
• C)It remains the same.
• D)It depends on how much the activity level increases.

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Definitions:

Money Supply

Refers to the total volume of currency and other liquid instruments in a country's economy at a specific time.

M2 Measure

A category of the money supply that includes all liquid monies like cash and checking deposits, as well as 'near money' such as savings deposits and time deposits.

Unit Banking

A banking system where each bank operates as an independent unit, without branches, providing services to its local community.

Unlimited Branching

A concept in computer science or mathematics referring to a structure or process that can expand in an unlimited number of directions or paths.