Suppose the U

question 113

Multiple Choice

Suppose the U.S.government has an annual budget of about $4 trillion.Does the U.S.government face the problem of scarcity?

• A)No, a government with $4 trillion in spending faces no real constraints.
• B)No, scarcity does not apply to governments.
• C)Yes, resources are limited even for the U.S.government.
• D)Yes, although the U.S.government can easily obtain more resources.
• E)Uncertain, economic theory has no answer to this question.

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Definitions:

Direct Labor-Hours

An evaluation of the cumulative hours spent directly in the manufacturing of products.

Total Overhead Applied

The sum of all overhead costs that have been allocated to products or services based on a predetermined overhead rate.

Overhead Assigned

The process of allocating indirect costs to specific cost objects, such as products, services, or departments.

Direct Labor-Hours

Direct labor-hours represent the total hours worked by employees directly involved in the manufacturing process, serving as a basis for allocating labor costs to products.