It Is Best to Compare This Year's Performance with Last

question 102

True/False

It is best to compare this year's performance with last year's actual performance rather than this year's budget.

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Definitions:

Sunk Costs

Costs that have already been incurred and cannot be recovered, and thus should not affect future economic decisions.

Average Fixed Cost

Is the fixed costs of production (costs that do not change with the level of output) divided by the quantity of output produced.

Marginal Cost

The cost associated with producing one additional unit of a product, which can vary depending on the level of production.

Output

The amount of goods or services produced by a person, machine, business, or industry.