Which of the Following Statements Is Correct

question 148

Multiple Choice

Which of the following statements is correct?

• A)Low prices may not always be in the public interest.
• B)If prices on scarce resources are set "too low," consumers will receive the "wrong" signals and be encouraged to consume more, thus squandering resources.
• C)Raising prices on scarce resources is generally politically unpopular.
• D)All of the above are correct.

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Definitions:

Manufacturing Overhead

Consists of indirect factory-related costs that are incurred when producing a product, such as maintenance, utilities, and salaries of supervisors.

Applied

The method of assigning or allocating overhead costs to specific products or jobs based on a predetermined rate.

Fixed Manufacturing Overhead

Costs incurred during the production process that do not vary with the level of production, such as rent for factory buildings, salaries of plant managers, and depreciation of manufacturing equipment.

Budget Variance

The variance between what was expected to be spent or earned, according to the budget, and the real amount that was spent or received.