The Use of Theoretical Capacity Results in an Unrealistically Low

question 85

Multiple Choice

The use of theoretical capacity results in an unrealistically low fixed manufacturing cost per unit because it is based on ________.

• A) real available capacity
• B) an unattainable level of capacity
• C) normal capacity utilization
• D) normal costing

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Definitions:

Social Norms

The unwritten rules that govern the behavior of individuals within a society, guiding what is considered acceptable or unacceptable.

Conform

The act of adjusting one’s behavior or thinking to match those of others or to meet societal standards.

Yield

The income return on an investment, such as the interest or dividends received, expressed as an annual percentage rate based on the investment's cost, its current market value, or its face value.

Foot-In-The-Door

A persuasion technique involving getting a person to agree to a small request to increase the likelihood of agreeing to a larger request later.