Cost-Push Inflation Starts with

question 27

Multiple Choice

Cost-push inflation starts with

• A)an increase in potential GDP.
• B)a decrease in aggregate supply.
• C)an increase in aggregate supply.
• D)an increase in aggregate demand.
• E)a decrease in aggregate demand.

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Definitions:

Support Department Allocations

The distribution of costs from support departments to producing departments based on the level of service used.

Cost Driver

A factor that causes the costs of an activity to increase or decrease.

Sequential Method

A cost allocation technique that processes cost pools in a pre-determined order, allocating costs to one cost object before moving on to the next.

Support Department Allocations

The process of attributing a portion of support (or indirect) department costs to the producing departments within an organization, based on agreed-upon criteria.