Which of the Following Is an Advantage of a Dual-Rate

question 93

Multiple Choice

Which of the following is an advantage of a dual-rate method?

• A) It is the most widely used method in practice.
• B) It is less costly to implement.
• C) It avoids the expensive analysis for categorizing costs as either fixed or variable.
• D) It allocates fixed cost as per the budgeted usage that helps in short and long-run planning.

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Definitions:

Average Variable Cost

The total variable cost divided by the quantity of output produced, representing the variable cost of producing one unit of a good or service.

Short Run

A period during which at least one factor of production is fixed, affecting the production capacity.

ATC

Average Total Cost refers to the total cost per unit of output, encompassing both fixed and variable costs.

Industry Supply Curve

A graphical representation showing the quantity of a good or service that producers are willing and able to supply at various prices.