If Economists Forecast an Increase in Aggregate Expenditure,which of the Following

question 198

Multiple Choice

If economists forecast an increase in aggregate expenditure,which of the following is likely to occur?

• A)GDP will rise.
• B)GDP will fall.
• C)Wages will fall.
• D)Inventories will rise.

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Definitions:

Direct Materials Price Variance

The difference between the actual price and the standard price of direct materials multiplied by the actual quantity of direct materials used in producing a product.

Units

In business and accounting, units refer to the individual pieces or quantities of a product or service.

Variable Factory Overhead

Refers to the indirect, variable costs that change with the level of production output, such as utilities for the manufacturing plant.

Controllable Variance

The difference between the actual variable overhead costs and the budgeted variable overhead for actual production.