Refer to Figure 5.1 for the Following Questions

question 36

Multiple Choice

Refer to Figure 5.1 for the following questions.
Figure 5.1

-Refer to Figure 5.1. As a result of an increase in the government budget deficit, the ________ for loanable funds will ________, thereby ________ the equilibrium real interest rate and ________ the equilibrium quantity of loanable funds.

• A)demand; rise; increasing; decreasing
• B)supply; rise; decreasing; increasing
• C)demand; fall; decreasing; decreasing
• D)supply; fall; increasing; decreasing

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Definitions:

Unit Product Cost

The total cost incurred to produce, package, and place a product ready for sale, divided by the number of units produced.

Absorption Costing

An accounting method that includes all manufacturing costs—direct materials, direct labor, and both variable and fixed overhead—in the cost of a product.

Unit Product Cost

The calculation of the total cost (including materials, labor, and overhead) to produce a single unit of a product.

Variable Costing

A costing method in which all variable manufacturing costs are included as inventoriable costs, while fixed manufacturing overhead is treated as an expense of the period.