The Primary Deficit Is Equal to

question 70

Multiple Choice

The primary deficit is equal to

• A)the amount by which government purchases, transfers, and net interest exceed tax revenues.
• B)the amount by which government purchases and transfers exceed tax revenues.
• C)the deficit plus net interest payments.
• D)total tax revenues minus net interest minus government expenditures.

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Definitions:

Overhead Costs

Expenses that are not directly tied to the production of goods or services, such as rent, utilities, and administrative salaries.

Direct Materials Quantity Variance

The difference between the actual quantity of direct materials used and the expected quantity, multiplied by the standard cost per unit.

Direct Labor Rate Variance

The difference between the actual cost of direct labor and the standard cost, attributed to the difference in the hourly wage rate paid and the standard rate expected.

Direct Labor Costs

These are the salaries and wages paid to employees directly involved in producing a company's goods or services.