In Which of the Following Situations Is the Political Process

question 3

Multiple Choice

In which of the following situations is the political process likely to result in the inefficient and wasteful use of resources?

• A) when the benefits are concentrated and the costs are concentrated
• B) when the benefits are concentrated and the costs widespread
• C) when the benefits are widespread and the costs are concentrated
• D) when the benefits are widespread and the costs are widespread

Calculate variable and fixed overhead variances and identify them as favorable or unfavorable.

Understand and compute volume variances.

Calculate labor variances including rate and efficiency.

Compute direct materials price and quantity variances.

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Definitions:

External Cost

Costs of an economic activity that are not borne by the parties involved but are instead imposed on others or society at large.

Private Value

The value of a good or service to an individual or firm for personal use, as opposed to its value to society or the economy at large.

Socially Optimal

A situation or outcome that is best from the society's point of view, where social welfare, including benefits and costs, is maximized.

Economic Well-being

A broad measure of the prosperity and quality of life of individuals or societies, encompassing material, social, and environmental dimensions.