A Demand Curve

question 59

Multiple Choice

A demand curve:

• A) shows the relationship between price and quantity demanded.
• B) indicates the quantity demanded at each price in a series of prices.
• C) graphs as a downsloping line.
• D) has all of the above characteristics.

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Definitions:

Direct Manufacturing Cost

These are costs that can be directly traced to the production of specific goods or services, such as raw materials and direct labor.

Differential Costs

The difference in total cost that will result from selecting one choice over another.

Sunk Costs

Sunk costs refer to money already spent and permanently lost, which cannot be recovered and should not influence future financial decisions.

Opportunity Costs

A rephrased definition: The potential gains or benefits that are lost when choosing one alternative over another in decision-making.