Why Might the FDA Err on the Side of "Overtesting

question 234

Multiple Choice

Why might the FDA err on the side of "overtesting" pharmaceutical drugs compared with the level of testing that is economically efficient?

• A) Dangerous side effects are more important than drug loss and drug lag.
• B) Dangerous side effects are less important than drug loss and drug lag.
• C) Drug lag and drug loss are not significant concerns in the case of most pharmaceutical drugs.
• D) Dangerous side effects are not relevant in most pharmaceutical drug cases.

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Definitions:

Depreciation Expense

The allocated amount of the cost of an asset, spread out over the time it is expected to be used, reflecting its consumption, wear and tear, or obsolescence.

Indirect Method

In cash flow calculation, this method adjusts net income for non-cash transactions and changes in working capital to arrive at net cash provided by operating activities.

Net Loss

The negative financial result that occurs when a company's expenses exceed its revenues.

Merchandise Inventories

Goods purchased and held for resale by a business, including products available for sale and items in the process of production for sale.