Expenses That Are Not Directly Borne by Producers or Their

question 13

Multiple Choice

Expenses that are not directly borne by producers or their customers are called:

• A) marginal external costs.
• B) marginal social costs.
• C) marginal private costs.
• D) opportunity costs.

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Definitions:

CVP Graph

A visual representation used in Cost-Volume-Profit Analysis to show the relationship between total costs, total sales, and profit (or loss) at various sales volumes.

Unit Volume

The quantity of items or units produced or sold.

Contribution Margin Ratio

The proportion of sales revenue that remains after variable costs are subtracted, indicating how much contributes to covering fixed costs and generating profit.

Fixed Expenses

Costs that do not fluctuate with the level of production or sales, such as rent, insurance, and property taxes.