-Refer to Figure 11-1

question 39

Multiple Choice

-Refer to Figure 11-1. Comparing the static budget to the actual outcomes, we can say the following:

• A) the manager had more direct labor hours.
• B) the variances are all unfavorable.
• C) the comparison is not useful for assessing managerial efficiency.
• D) a flexible budget should be used for assessing efficiency.
• E) All of these.

---

Definitions:

Economic Profits

The difference between total revenue and total costs, including both explicit and implicit costs, reflecting the true profitability of a company.

Short Run

A period in economics during which at least one input is fixed and cannot be changed. It contrasts with the long run, where all inputs can be adjusted.

Long Run

A period in economic analysis during which all factors of production and costs are variable, allowing for full industry adjustment.

ATC

Average Total Cost, which is the total cost of production divided by the number of goods produced, representing the cost per unit of output.