Variances Should Be Investigated If They ________

question 51

Multiple Choice

Variances should be investigated if they ________.

• A)are favorable
• B)are unfavorable
• C)are smaller than the prior period
• D)exceed certain dollar or percentage deviations from the budget

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Definitions:

Strong Axiom

A mathematical condition used in decision theory and economic models that strengthens the requirements for consumer choice consistency over time or across different conditions.

Revealed Preference

A theory that determines consumer's preferences by observing their purchasing habits and behaviors instead of their preferences being explicitly stated.

Revealed Preference

A theory that assumes individuals' preferences can be determined by their purchasing habits.

Weak Axiom

A principle in consumer choice theory stating that if a consumer prefers bundle A over bundle B when both are available at the same prices, then the consumer will not purchase more of bundle B if its price rises.