A Flat or Slightly Sloped Regression Line Indicates a Strong

question 67

True/False

A flat or slightly sloped regression line indicates a strong relationship between the cost driver and costs.

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Definitions:

Variable Costs

Spendings that move in tandem with the level of output or number of sales.

Sales Dollars

The total revenue generated from the sale of goods or services before any expenses are deducted.

Break-Even Point

The production level or sales volume at which total revenues equal total expenses, resulting in no net loss or gain.

Contribution Margin

The difference between sales revenue and variable costs, which contributes towards covering fixed costs and earning profit.