The on Balance Volume (OBV) Indicator

question 8

Multiple Choice

The on balance volume (OBV) indicator

• A) considers only the amount of daily trading volume.
• B) indicates an up market when heavy volume accompanies price increases.
• C) is divergent when the OBV is falling and prices are also falling.
• D) rises by 10,000 on a day when the trading volume is 5,000 shares and the price rises by $2.

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Definitions:

Variable Costing

A costing method that includes only variable production costs - direct materials, direct labor, and variable manufacturing overhead - in the cost of a product.

Variable Production Costs

Costs that fluctuate with the level of output production, such as raw materials and direct labor.

Variable Costing

An accounting method that includes only variable production costs—direct materials, direct labor, and variable manufacturing overhead—in product costs.

Fixed Manufacturing Overhead

The set costs associated with producing goods that do not change with the level of output, including salaries, rent, and insurance.