In Japan, the Market Value of the Land Is Approximately

question 56

Multiple Choice

In Japan, the market value of the land is approximately four times that of all the land in the United States, even though Japan is only about the size of California.The most likely explanation for this fact is

• A)greater demand for land in Japan relative to the supply than in the United States.
• B)land is very productive in Japan.
• C)land is not fixed in supply in the United States.
• D)Japanese workers are very productive.

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Definitions:

Fixed Manufacturing Costs

Expenses that do not change with the level of production, including things like rent for factory space and salaries of permanent staff.

Absorption Costing

An accounting method that includes all manufacturing costs (direct materials, direct labor, and both variable and fixed manufacturing overhead) in the cost of a product.

Product Costs

All costs that are involved in acquiring or making a product. In the case of manufactured goods, these costs consist of direct materials, direct labor, and manufacturing overhead. Also see Inventoriable costs.

Manufacturing Costs

Expenses directly related to the production of goods, including direct materials, direct labor, and manufacturing overhead.