When the Text Refers to Rational Self-Interest, It Means

question 213

Multiple Choice

When the text refers to rational self-interest, it means

• A)your looking out for what is best for you as an individual.
• B)your focus on your own contributions to society.
• C)behavior that makes society better off.
• D)behavior that helps your employer earn higher profits.

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Definitions:

Variable Costing

An accounting method that only allocates variable costs to inventory, treating fixed costs as period expenses that are charged to the income statement in the period they are incurred.

Absorption Costing

A method of inventory costing that includes all manufacturing costs - direct materials, direct labor, and both variable and fixed manufacturing overheads - in the cost of a unit of product.

Contribution Format

A financial statement layout that separates fixed costs from variable costs to highlight the contribution margin of a business.

Absorption Costing

A financial tracking method that brings together all costs of production—direct materials, direct labor, and all overhead, both variable and fixed—inclusion in the price of a product.