If the EPA Does Implement Its Plan to Enact Tougher

question 72

Multiple Choice

If the EPA does implement its plan to enact tougher limits on smog-forming ozone,the quantity of product being produced by the polluting firms will ________ and the product price will ________.

• A)increase; increase
• B)increase; decrease
• C)decrease; increase
• D)decrease; decrease

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Definitions:

Fixed Manufacturing Overhead

Consists of the costs that do not vary with the level of production, such as rent, property taxes, and salaries of permanent employees in a manufacturing facility.

Cost Allocation

The process of identifying, aggregating, and assigning costs to cost objects such as products, services, or departments.

Insulating Allocations

An approach in budgeting where specific costs are assigned or isolated to individual departments or projects to prevent them from affecting others.

Direct Labor Cost

The expense associated with the labor time of workers directly involved in the production of goods or services.