Which of the Following Is Not a Benefit of Activity-Based

question 12

Multiple Choice

Which of the following is not a benefit of activity-based costing?

• A)Lower cost.
• B)Better decisions.
• C)Improved cost management.
• D)Identification of cost drivers.

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Definitions:

Average Total Cost

The total cost per unit of output, calculated by dividing the total cost by the quantity of output produced.

Efficient Scale

The level of production at which a firm operates with the lowest average total costs, achieving economies of scale without incurring diseconomies of scale.

Short-Run Cost Curves

Graphical representations that show the relationship between a firm's costs and output levels in the short term.

Long-Run Curve

The graphical representation in economics of the relationship between output and input when all inputs are variable, showing potential economies of scale.