Without Financial Intermediaries, the Cost of Funds Would Be About

question 14

True/False

Without financial intermediaries, the cost of funds would be about the same as with financial intermediaries.
Intermediaries expedite the flow of funds efficiently, thereby reducing the cost of these funds.

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Definitions:

Variable Overhead Rate

The rate at which variable overhead costs are allocated to products, changing with the level of production.

Efficiency Variance

A measure in cost accounting that calculates the difference between the actual quantity of input used and the standard amount expected to be used, multiplied by the standard price.

Budget Variance

The difference between budgeted or planned financial performance and the actual performance.

Predetermined Overhead Rate

An estimated rate used to allocate manufacturing overhead costs to products based on a specific activity base, aiding in cost control and pricing decisions.