The Period During Which Real GDP Falls During a Business

question 104

Multiple Choice

The period during which real GDP falls during a business cycle is called:

• A) peak.
• B) recession.
• C) recovery.
• D) trough.

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Definitions:

Labor Rate Variance

The difference between the actual cost of direct labor and the expected (or standard) cost, based on the standard hours worked and standard labor rate.

Variable Overhead Rate Variance

The difference between the actual variable overhead incurred and the expected variable overhead based on standard cost.

Materials Price Variance

The difference between the actual cost of raw materials and the standard or expected cost, multiplied by the quantity of materials purchased.

Variable Overhead Rate Variance

The difference between the actual variable overhead incurred and the expected (or budgeted) variable overhead based on a standard rate.