Using Prices from 2009, GDP Grew 10 Percent Between 2009

question 127

Multiple Choice

Using prices from 2009, GDP grew 10 percent between 2009 and 2010; using prices from 2010, GDP grew 8 percent between 2009 and 2010.For its link back to the base year, the BEA will use ________ percent as the growth in real GDP between 2009 and 2010.

• A) 10
• B) 8
• C) 2
• D) 18
• E) 9

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Definitions:

Actual Fixed Overhead Costs

Actual fixed overhead costs are the incurred expenses that do not vary with the level of production or sales, such as rent and salary of permanent staff.

Budgeted Fixed Manufacturing Overhead

The estimated total fixed costs required for the manufacturing process, planned in advance for a specific period.

Materials Price Variance

The difference between the actual cost of materials used in production and the budgeted or standard cost, indicating how effectively a company controls its material costs.

Standard Costs

Predetermined costs for materials, labor, and overhead that are used for budgeting and cost control purposes.