Why Are the Medicis an Object Lesson for Contemporary Bankers

question 57

Multiple Choice

Why are the Medicis an object lesson for contemporary bankers?

• A) Through early globalization, they realized the benefit of diversified risk.
• B) By entering into politics, they put their financial empire at risk.
• C) By recognizing the movement towards sovereign states, they were able to create sovereign wealth.
• D) By providing dangerous loans to princes, they were put at risk when they defaulted.
• E) They experienced the first known sub-prime mortgage housing crisis.

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Definitions:

Predetermined Overhead Rate

A rate used to apply manufacturing overhead to products or job orders, calculated based on estimated overhead costs and an allocation base.

Predetermined Overhead Rate

A rate used to allocate manufacturing overhead costs to products or job orders, calculated at the start of the fiscal year based on estimated costs and activities.

Labor-Hour

A measure of the amount of work or labor time required or used to produce a good or service.

Variable Overhead Efficiency Variance

The difference between the actual variable overhead incurred and the standard cost of variable overhead that should have been incurred based on the efficiency of operations.