The Process of Seasonal Adjustment Is Important Because

question 111

Multiple Choice

The process of seasonal adjustment is important because

• A)Economic variables predictably change from season to season, so to understand the economic importance of month-to- month changes you need to account for it.
• B)Economic variables may predictably change from season to season, but those changes are not significant.
• C)Economic variables rarely change from season to season
• D)Economic variables are politically determined.

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Definitions:

Variable Expenses

Costs that change in proportion to the activity of a business, such as sales or production levels.

Fixed Expenses

Costs that do not change in total despite fluctuations in the volume of goods or services produced or sold.

Annual Sales

The total revenue generated from the sale of goods or services in one fiscal year.

Variable Expenses Per Unit

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