Which of the Following Statements Is Correct

question 43

Multiple Choice

Which of the following statements is correct?

• A) The operation of a market system eventually results in an equal distribution of income
• B) Producers are "sovereign" in a market economy because they determine what is produced
• C) The market system is efficient at allocating resources, but not at allocating products
• D) Freedom of choice and enterprise are essential elements of the market system

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Definitions:

Variable Manufacturing Overhead

Costs in manufacturing that change with the level of production output, like utilities or raw materials.

Direct Labor-Hours

The total hours worked by employees who are directly involved in the production of goods or services.

Predetermined Overhead Rate

A predetermined overhead rate is an estimated charge per unit of activity that is used to allocate indirect costs to products or services.

Assembly Department

A section of a manufacturing firm where products or components are assembled before final packaging or shipping.