Which Statement Is True

question 211

Multiple Choice

Which statement is true?

• A)AFC declines with output.
• B)ATC declines with output.
• C)AFC - AVC = ATC.
• D)Output divided by fixed cost = AFC.

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Definitions:

Favourable Variances

Differences between actual costs and budgeted costs that result in a better-than-expected financial performance, often indicating cost savings or higher revenues.

Large Variances

Significant differences between planned and actual figures in a budget, project, or any performance measurement, indicating greater deviations from expectations.

Consistent Trends

Patterns or changes in data that continue over a period of time in a similar manner.

Standard Direct Labour Hours

The estimated amount of labor hours required to produce a certain amount of output under normal conditions.