Consider a Simple Macro Model with a Constant Price Level

question 144

Multiple Choice

Consider a simple macro model with a constant price level and demand-determined output.In such a model,a downward shift of the saving function causes equilibrium national income to

• A)fall because the AE function shifts downward simultaneously.
• B)rise because the AE function shifts upward simultaneously.
• C)remain constant but consist of more consumption and less investment.
• D)remain constant but consist of less consumption and more investment.
• E)remain constant because it does not affect desired aggregate expenditure.

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Definitions:

Activity-Based Costing

A costing method that assigns costs to products or services based on the activities and resources that go into creating them, aiming for more accurate cost information.

Activity-Based Costing

is a method of accounting that assigns costs to products based on the activities they require, aiming to provide more accurate product costing.

Activity Rate

The activity rate refers to a predetermined overhead rate used in activity-based costing to allocate costs to products or services based on specific activities.

Predetermined Overhead Rate

A rate calculated before the accounting period begins, used to assign overhead costs to products or job orders based on a relevant activity base such as machine hours or labor hours.