As It Is Difficult to Establish and Enforce Ownership Rights

question 39

True/False

As it is difficult to establish and enforce ownership rights over air, people have less incentive to preserve air quality than if its ownership was clearly defined.

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Definitions:

Direct Materials Quantity Variance

The variance between the real amount of direct materials consumed during manufacturing and the anticipated standard amount.

Standard Materials Quantity

The expected amount of materials that should be used for the production of a certain number of units, as set by a company's standards.

Board Feet

A unit of measure for the volume of lumber, equivalent to a piece of wood one foot long, one foot wide, and one inch thick.

Direct Materials Quantity Variance

The difference between the expected and actual quantity of materials used in production, multiplied by the standard cost per unit of material.