Which of the Following Statements Regarding a Linear Cost Function

question 120

Multiple Choice

Which of the following statements regarding a linear cost function is TRUE?

• A)When there are only fixed costs, total material costs increase as the number of units produced increases.
• B)The slope coefficient of a mixed cost line intersects the vertical axis at zero.
• C)The relationship between the cost driver and the fixed cost is represented by the cost-benefit relationship.
• D)It is easier to identify a single measure of benefit in a more heterogeneous cost pool.
• E)A linear cost function for manufacturing overhead can be graphed when their is a cause-and-effect relationship between the level of activity and the costs related to that level of activity.

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