Figure 5.2 -Refer to Figure 5.2.A Shift from D₁ to D₂ Will

question 42

Multiple Choice

Figure 5.2

-Refer to Figure 5.2.A shift from D₁ to D₂ will result from which of the following?

• A) an increase in expected future profits
• B) an increase in corporate taxes
• C) an increase in tax credits for savings
• D) a decrease in the desire of households to consume today

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Definitions:

High-low Method

A technique used in cost accounting to estimate fixed and variable costs based on the highest and lowest levels of activity.

Net Operating Income

The net profit of a business is calculated by deducting operating expenses from the gross profit and before accounting for interest and taxes.

Sales Volume

The number of units sold within a reporting period, used as a measure of business activity.

Margin of Safety

The difference between actual sales and the break-even point, indicating how much sales can drop before a company incurs a loss.