If the Fed Pursues an Expansionary Monetary Policy

question 45

Multiple Choice

If the Fed pursues an expansionary monetary policy:

• A) the dollar will rise.
• B) U.S.imports from other countries will rise.
• C) U.S.exports to other countries will rise.
• D) aggregate supply will increase.

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Definitions:

Denominator Activity

The total base activity used to allocate overhead costs in cost accounting, such as total direct labor hours or machine hours available.

Direct Labor-Hours

The total hours worked by employees directly involved in the manufacturing process, used in allocating manufacturing overhead.

Overapplied

A condition where the manufacturing overhead allocated to products exceeds the actual manufacturing overhead costs incurred.

Underapplied

A situation in cost accounting where the allocated overhead costs are less than the actual overhead costs.