Which of These Assumptions Is Often Realistic for a Firm

question 261

Multiple Choice

Which of these assumptions is often realistic for a firm in the short run?

• A)The firm can vary both the size of its factory and the number of workers it employs.
• B)The firm can vary the size of its factory but not the number of workers it employs.
• C)The firm can vary the number of workers it employs but not the size of its factory.
• D)The firm can vary neither the size of its factory nor the number of workers it employs.

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Definitions:

Step-Down Method

A cost allocation method used in accounting to assign overhead costs to products or service departments in a sequential manner.

Step-Down Method

A cost allocation method that sequentially allocates service department costs to other service departments and then to production departments.

Janitorial Department

A division within an organization dedicated to the maintenance and cleaning of buildings and facilities.

Allocated Based on Space

The distribution of resources or costs among departments or projects according to the physical area they occupy or require.