Intentionally Understating Revenues and / or Overstating Costs During a Budgeting

question 44

Multiple Choice

Intentionally understating revenues and / or overstating costs during a budgeting process is called:

• A) Budgetary slack
• B) Zero-based budgeting
• C) Fraudulent financial reporting
• D) Participative budgeting

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Definitions:

Intermediate Products

These are goods that are used as inputs in the production of other goods and services, not intended for final consumption.

Final Products

Final products are goods or services that have completed the production process and are ready for sale to consumers or businesses, without needing further transformation.

Nominal GDP

The gross domestic product measured at current market prices, without adjusting for inflation, reflecting the value of all goods and services produced.

Price Level

Refers to the average of current prices across the entire spectrum of goods and services produced in the economy.