Which Fiscal Stimulus Policy Will Provide a Greater Incentive to Work

question 218

Multiple Choice

Which fiscal stimulus policy will provide a greater incentive to work?

• A) a tax rebate program
• B) an income tax rate cut
• C) an income tax increase
• D) a bond purchase program

---

Definitions:

Predetermined Overhead Rate

A rate used to allocate manufacturing overhead costs to products, calculated before the period begins based on estimated costs and activity levels.

Direct Labour Hour

Direct labour hour is a measure of the amount of time workers spend on direct production activities, directly involved in manufacturing goods or providing services.

Manufacturing Overhead

Manufacturing expenses not directly linked to individual product units, encompassing indirect materials and labor.

Predetermined Overhead Rate

An estimated rate used to assign manufacturing overhead costs to products based on a specific activity base, like machine hours or labor hours.