When There Is an Improvement in Technology,holding All Else Constant

question 65

Multiple Choice

When there is an improvement in technology,holding all else constant,

• A) the production possibilities frontier will shift inward
• B) society faces larger opportunity costs from shifting productive resources from one use to another
• C) goods and services will increase in price
• D) the economy must have some idle resources
• E) the production possibilities frontier will shift outward

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Definitions:

Adjusted Cost of Goods Sold

The cost of goods sold that has been adjusted for changes in inventory levels or valuation methods.

Overapplied Manufacturing Overhead

A situation where the allocated amount of manufacturing overhead costs exceeds the actual overhead costs incurred.

Unadjusted Cost of Goods Sold

The initial calculation of the cost of goods sold that has not been modified for returns, allowances, or discounts.

Overapplied Manufacturing Overhead

A scenario where the allocated manufacturing overhead costs exceed the actual overhead costs incurred, resulting in a credit balance.