If a Nation Starts Out with Very Little Capital

question 96

Multiple Choice

If a nation starts out with very little capital

• A)it can increase its capital if it is able to divert productive resources from producing consumer goods to producing capital goods.
• B)the process of diverting some resources from producing consumer goods to producing capital goods will most likely be quite painful.
• C)if it is lucky enough to possess a valuable commodity that the industrial world wants,such as oil,it can sell its oil in exchange for plant and equipment and thus industrialize.
• D)All of the choices are true.

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Definitions:

Batch Level Activity

Activities and costs associated with processing a batch of units, which occur each time a batch is handled or processed, regardless of the number of units in the batch.

Activity-Based Product Costing

A costing method that allocates overhead and indirect costs to products based on the activities required to produce them.

Product Line

A group of related products marketed by a company, often sharing a common theme, technology, or target market.

Activity-Based Costing System

A costing methodology that assigns costs to products or services based on the activities required to produce them, considering the resources consumed by each activity.