Which One of the Following Statements Is Most Clearly Inconsistent

question 71

Multiple Choice

Which one of the following statements is most clearly inconsistent with the economic way of thinking?

• A) "If you give a person a fish, you feed him for a day; if you teach him to fish, you feed him for life."
• B) "If the government provides a good free to citizens, then the opportunity cost of the good is zero."
• C) "If you derive the same satisfaction from a hamburger as a chicken sandwich, it makes sense to have the cheaper alternative for lunch."
• D) "When it is cheaper to have someone else mow your lawn than to mow it yourself, hiring someone to do the job is consistent with economizing behavior."

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Definitions:

Labour Rate Variance

The difference between the actual cost of labour per hour and the standard cost that was expected, multiplied by the total hours worked.

Variable Overhead Efficiency Variance

The difference between the actual variable overhead incurred and the expected variable overhead based on standard costs for the actual production achieved.

Actual Direct Labour Rate

The actual cost per hour paid to workers for their labor.

Standard Labour Rate

The predetermined cost per hour of labor, used in budgeting and costing to estimate the labor costs associated with a product.