A _____ Is a Technique Used to Show the Effects

question 21

Multiple Choice

A _____ is a technique used to show the effects of changing one or more variables on an outcome.

• A)sensitivity analysis
• B)decision tree  
• C)Monte Carlo analysis
• D)systems analysis

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Definitions:

Direct Materials

Ingredients or substances that are directly linked to the manufacturing of a particular item.

Relevant Range

The range of activity within which the assumptions about variable and fixed cost behavior are valid for the purposes of cost estimation and budgeting.

Total Fixed Costs

The sum of all costs that do not change with the level of production or sales over a certain period.

Unit Fixed Costs

The fixed costs associated with producing a single unit of product, which remain constant regardless of the level of production or sales volume.