According to the Keynesian View, If Policy Makers Thought the Economy

question 103

Multiple Choice

According to the Keynesian view, if policy makers thought the economy was about to fall into a recession, which of the following would be most appropriate?

• A) a reduction in government expenditures and/or an increase in taxes
• B) an increase in government expenditures and/or a reduction in taxes
• C) make no policy changes because market forces will assure the maintenance of full employment.
• D) maintain a balanced budget

Analyze the implications of accepting individual customization orders on profitability.

Determine the relevance of sunk costs and their exclusion from future business decisions.

Conduct differential analysis for further processing and make or buy decisions.

Apply the variable cost concept in setting prices and calculating desired profits.

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Definitions:

Direct Labor

The labor costs directly associated with the manufacturing of a product or the provision of a service.

Factory Overhead

All indirect costs associated with manufacturing, excluding direct materials and direct labor. Examples include utilities, depreciation on factory equipment, and salaries of factory supervisors.

Lean Manufacturing

An orderly technique for minimizing waste in industrial operations while ensuring productivity remains unaffected.

Manufacturing Cells

A layout design in manufacturing where machines and workstations are arranged to optimize the production process and reduce waste, focusing on the manufacturing of a single product or a group of similar products.