A Bill Is Submitted to Parliament in January 2001 That

question 3

Multiple Choice

A bill is submitted to Parliament in January 2001 that is designed to stimulate the economy and increase employment.The legislation is passed in September 2001,and the spending occurs from October 2001 to March 2002.Consequently

• A)the full effect of the fiscal policy change will not be felt until after March 2002 because of the effect time lag.
• B)the full effect of the fiscal policy change will not be felt until after March 2002 because of the recognition time lag.
• C)the full effect of the fiscal policy change will be felt by March 2002 because people anticipate the spending and change their behaviour accordingly.
• D)the full effect of the fiscal policy change will be felt when the last of the monies are spent by the government.

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Definitions:

Batch-level Activity

Operations that are performed on groups of units within the production process rather than individually.

Setting up Equipment

The process of assembling, arranging, and making operational machinery or apparatus needed for a specific task or purpose.

Activity Rates

Charges or fees based on predetermined activities used in costing systems to allocate indirect costs to products.

Activity-Based Costing

A costing method that assigns overhead and indirect costs to specific activities, providing a more accurate product cost.