If You Take Out a Bank Loan Prior to Unanticipated

question 56

Multiple Choice

If you take out a bank loan prior to unanticipated inflation

• A) it will be harder for you to repay the loan because of the inflated dollar.
• B) you will gain at the expense of your bank.
• C) your bank will gain at your expense.
• D) neither you nor your bank will be affected, because the loan was made prior to the inflation.

---

Definitions:

Product Cost

The total costs incurred to create a product, including direct labor, direct materials, and overhead expenses.

Automation

The use of technology to perform tasks with minimal human intervention, improving efficiency and consistency.

Direct Labor

The work contributed by employees who are directly involved in the manufacturing process of a product.

Indirect Materials

Supplies used in the production process but not directly traceable to a finished product, such as lubricants for machinery.