The Relationship Between the Elasticity of Product Demand and the Elasticity

question 319

Multiple Choice

The relationship between the elasticity of product demand and the elasticity of demand for labor employed in its production is such that, other things being equal,

• A)the more elastic the demand for the product, the less elastic the demand for labor.
• B)the more elastic the demand for the product, the more elastic the demand for labor.
• C)the elasticity of product demand only affects the elasticity of labor demand when the product market is purely competitive.
• D)if product demand is perfectly elastic, labor demand will be perfectly inelastic.

Appreciate the impact of demographic and social changes, such as movements between urban and rural areas or changes in the labor force composition, on GDP.

Understand the recording of raw materials, work in process, finished goods, and manufacturing overhead in a job order cost system.

Calculate predetermined overhead rates and apply overhead to manufacturing costs.

Prepare journal entries for transactions involving raw materials, labor, overhead, and the sales process.

---

Definitions:

Placed In Service

The point in time when an asset is ready and available for its intended use, often marking the start of depreciation or amortization for accounting purposes.

Depreciable Cost

The total cost of an asset that is subject to depreciation, including purchase price and any additional expenses to bring the asset to its intended use, minus salvage value.

Straight-Line Depreciation

An approach to apportion the value of a tangible asset across its productive years in uniform yearly sums.

Estimated Useful Life

The expected timeframe during which an asset is considered to be useful or productive for its intended purpose.