Assume the Budget Standard for Management Salaries Is $360,000 Per

question 11

Multiple Choice

Assume the budget standard for management salaries is $360,000 per year and the preliminary budget assumed 4,000 outputs would be produced. At the end of the year, 4,060 units were produced. The final, restated budget for management salaries:

• A) should remain the same as the preliminary budget.
• B) should increase by $5,400.
• C) should decrease by $5,400.
• D) cannot be determined.

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Definitions:

Shortage

A situation where demand exceeds supply, resulting in insufficient availability of a product or service.

Permanent Shortage

A sustained situation where the demand for a good or service persistently exceeds its supply, often due to fixed or limited quantities.

Price System

Mechanism that allocates resources, goods, and services based on supply and demand.

Price Ceilings

Price ceilings are regulatory measures that set a maximum price that can be charged for certain goods or services, with the goal of ensuring affordability.