With an MPS of 0

question 193

Multiple Choice

With an MPS of 0.3, the MPC will be

• A) 1 − 0.3.
• B) 0.3 − 1.
• C) 1/0.3.
• D) 0.3.

---

Definitions:

Spending Variance

The difference between the budgeted amount of expense or revenue and the actual amount spent or received.

Activity Variance

The difference between planned activity costs and actual activity costs in managerial accounting, used for budget control and performance evaluation.

Fixed Cost

Expenses that do not change with the level of production or sales over a short period, such as rent, salaries, and insurance premiums.

Variable Cost

Expenditures that fluctuate with production output, including ingredients, packaging, and labor directly involved in production.