A Severe Drought Hits a Country and Reduces Farm Output

question 59

Multiple Choice

A severe drought hits a country and reduces farm output by 50%.In the short run,this will ________ output and ________ employment.

• A) decrease; decrease
• B) decrease; increase
• C) decrease; have no effect on
• D) have no effect on; have no effect on
• E) increase; increase

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Definitions:

Variable Manufacturing Overhead

Costs associated with manufacturing that vary with production volume, such as indirect materials and utilities.

Direct Labor-Hour

A measurement of labor used in production, specifically the time spent by direct labor workers on a given job or project.

Manufacturing Overhead Budget

An estimation of all manufacturing overhead costs planned for a specific period, which includes indirect costs related to manufacturing.

Selling and Administrative Expense Budget

A financial plan that estimates future sales, administrative expenses, and related activities over a specific period.