Economic Models

question 175

Multiple Choice

Economic models

• A)are not useful because they omit many real-world details.
• B)are usually composed of diagrams and equations.
• C)are useful because they do not omit any real-world details.
• D)are usually plastic representations of the economy.

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Definitions:

Cash Disbursements

Outflows of cash for expenses, including payments to suppliers, employees, and other creditors.

Manufacturing Overhead Budget

A detailed plan showing the production costs, other than direct materials and direct labor, that will be incurred over a specified time period.

Variable Selling

Refers to costs that vary directly with the level of sales, such as commissions and shipping charges.

Administrative Expense Budget

A projection of the costs associated with the general administration and management of a business.