During a Time of High Unemployment,a Country Can Increase the Production

question 262

Multiple Choice

During a time of high unemployment,a country can increase the production of one good or service

• A) without decreasing the production of something else.
• B) but must decrease the production of something else.
• C) and must increase the production of something else.
• D) by using resources in the production process twice.
• E) but the opportunity cost is infinite.

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Definitions:

Fixed Manufacturing Overhead

The portion of total manufacturing overhead costs that remains constant regardless of the level of production, such as factory rent or salaries of permanent staff.

Direct Materials

Ingredients or substances that are directly linked to the manufacturing of a particular item.

Relevant Range

The range of activity within which the assumptions about variable and fixed cost behavior are valid for the purposes of cost estimation and budgeting.

Total Fixed Costs

The sum of all costs that do not change with the level of production or sales over a certain period.