One Reason the U

question 119

Multiple Choice

One reason the U.S.government might subsidize research of an alternative to crude-oil based gasoline is that

• A) more substitutes will reduce the price of crude-oil based gasoline.
• B) more substitutes will increase the elasticity of crude-oil based gasoline.
• C) more substitutes will reduce the impact of supply shocks on the price of crude-oil based gasoline.
• D) Any or all of the above.

---

Definitions:

Activity-Based Costing

Activity-based costing is an accounting method that identifies and assigns costs to specific activities, facilitating more precise economic analysis of various business processes.

Activity Rates

Rates used in activity-based costing to assign costs to products or services based on the amount of an activity they consume.

Activity-Based Costing

A method of costing that identifies individual activities as the fundamental cost objects and uses the costs of these activities to compute the costs of various products or services.

Direct Labor-Hours

The total hours worked by employees directly involved in the production process, often used as a basis for allocating overhead costs.