Figure 8-9 the Vertical Distance Between Points a and C Represents a Represents

question 72

Multiple Choice

Figure 8-9
The vertical distance between points A and C represents a tax in the market.
-Refer to Figure 8-9.The imposition of the tax causes the price paid by buyers to increase by

• A)$20.
• B)$200.
• C)$300.
• D)$500.

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Definitions:

Transfer Price

The price at which goods and services are transferred between departments or subsidiaries of the same company.

Variable Cost

Costs that vary directly with the level of production or sales volume, such as raw materials or direct labor.

General Transfer-Pricing Formula

A method or set of guidelines used to determine the price at which goods and services are transferred between departments or divisions within the same company.

Transfer Price

The cost at which products and services are exchanged among departments within the same corporation.