If the Price of Personal Computers Were to Rise, Then

question 352

Multiple Choice

If the price of personal computers were to rise, then the demand for printers would decrease because personal computers and printers are

• A) complementary goods.
• B) consumer goods.
• C) inferior goods.
• D) substitute goods.

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Definitions:

Variance Analysis

The process of investigating the difference between planned and actual numbers to understand deviations in financial performance.

Direct Materials Price Variance

The difference between the actual cost and the standard cost of materials used in production, indicating how effectively a company manages its material costs.

Flexible Budget

A budget that adjusts or flexes with changes in volume or activity levels of the organization.

Variable Budget

A financial plan that adjusts for changes in the volume of activity, allowing for flexible cost controls depending on actual performance.