Financial Intermediaries Are Able to Exploit Economies of Scale Since

question 66

Multiple Choice

Financial intermediaries are able to exploit economies of scale since

• A) the equipment or expertise necessary for one transaction can be applied to other transactions.
• B) they have special licenses needed to perform financial transactions.
• C) financial markets fail to do so.
• D) they can reduce transactions costs, but not information costs.

Prepare a cost reconciliation report in a process costing system.

Distinguish between the direct method and other methods for allocating service department costs to operating departments.

Understand the impact of lean production on process costing and the computation of equivalent units.

Understand the concept of service department cost allocation.

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Definitions:

Variance

A measure of the spread between numbers in a data set, showing how far each number in the set is from the mean and thus from every other number in the set.

Recession

A noticeable drop in economic performance affecting the entire economy, enduring longer than several months, usually evident in real GDP, real income, employment, industrial output, and wholesaleretail sales.

Variance

A statistical measurement of the spread between numbers in a data set, indicating how much the numbers differ from the average.

Variance

In statistics, the measure of dispersion within a data set, representing the average of the squared differences from the mean.