Which of the Following Statements About Markets Is Correct? I

question 293

Multiple Choice

Which of the following statements about markets is correct? I. A market helps resources move to their highest-valued uses by means of prices changes.
II) A market represents the exchanges of both buyers and sellers.

• A) I only
• B) II only
• C) Both I and II
• D) Neither I nor II

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Definitions:

Distorted Product Costs

The result of allocating overhead or other costs to products in a manner that does not accurately reflect the true resources consumed by the products.

Non-volume Factors

Elements that affect a business’s operations and cost structures that are not related to the volume of goods or services produced, such as changes in technology or regulatory environments.

Non-manufacturing Costs

Expenses not directly tied to the production process, such as selling, general, and administrative expenses.

Non-manufacturing Overhead

Expenses incurred by a company that are not directly related to the production process, such as administrative and marketing expenses.