Figure 19.3 -Suppose the Above Graph in Figure 19.3 Represents the Market

question 223

Multiple Choice

Figure 19.3
-Suppose the above graph in Figure 19.3 represents the market for the British pound under the Bretton Woods System.If the par exchange rate was set at 2 United States dollars,and the situation persisted,

• A) the currency would be overvalued.
• B) there would need to be a revaluation of the currency.
• C) the supply of pounds would be less than the demand for pounds.
• D) the supply of pounds would be greater than the demand for pounds.

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Definitions:

Standard Direct Materials

The predetermined cost and quantity of materials required for the production of goods, used in budgeting and costing.

Direct Materials

Raw materials that can be directly identified and easily traced to the manufacturing of a final product.

Standard Materials Price

The predetermined cost per unit of material that is used for budgeting and cost control purposes in manufacturing.

Direct Materials

Raw materials that are directly incorporated into a finished product and are a significant part of the manufacturing process.