Scientists Studying Human Behavior Have Found That People Tend to

question 101

Multiple Choice

Scientists studying human behavior have found that people tend to

• A)always make rational decisions.
• B)make systematic errors in their decisions.
• C)make only random errors in their decisions.
• D)always make decisions that are not rational.

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Definitions:

Variable Costing

A costing method in which variable manufacturing costs are included in product costs, while fixed manufacturing costs are treated as period costs.

Absorption Costing

An accounting method that assigns all manufacturing costs, both variable and fixed, to products, thereby impacting the inventory valuation on the balance sheet.

Net Operating Income

The profit a company makes from its operations, calculated as total revenue minus operating expenses, excluding taxes and interest.

Variable Costing

An accounting method that only includes variable production costs—direct materials, direct labor, and variable manufacturing overhead—in product costs.