If Good B Is a Complement to Good A, Then

question 152

Multiple Choice

If good B is a complement to good A, then a decrease in the price of B

• A)increases the quantity demanded of A
• B)decreases the demand for A
• C)increases the demand for A
• D)decreases the quantity demanded of A
• E)will cause the demand for B to increase

---

Definitions:

Standard Direct Materials

The predetermined cost and quantity of raw materials expected to be used in the production process, used for budgeting and performance evaluation.

Fixed Factory Overhead Volume Variance

The difference between the budgeted and actual fixed overhead costs, due to variations in production levels.

Variable Factory Overhead Controllable Variance

The difference between the actual variable overhead costs incurred and the expected costs based on the standards set for the production volume.

Total Factory Overhead Cost Variance

The difference between the actual overhead costs incurred and the standard overhead costs assigned to production over a given period.