When Cost Driver Analysis Is Used,organizational Profit or Loss Can

question 31

Multiple Choice

When cost driver analysis is used,organizational profit or loss can be determined by subtracting

• A)organizational costs from total margin provided by products.
• B)organizational costs from total product revenue.
• C)total product costs from total product revenue.
• D)total unit,batch,product/process,and organizational level costs incurred for a period from total product revenue.

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Definitions:

Output

The quantity of goods or services produced by a firm, industry, or economy in a specified period.

Production Function

An equation that quantifies the output that can be generated from different combinations of factor inputs, reflecting the efficiency and technology of the production process.

Returns To Scale

The change in output resulting from a proportional change in all input factors; identifies if output increases at a faster, equal, or slower rate than inputs.

Marginal Rate Of Substitution

The pace at which a consumer opts to swap one item for another, ensuring their overall happiness remains unchanged.