Consider the Following Statements

question 87

Multiple Choice

Consider the following statements.
i. Product diversity creates problems in product costing because diverse products tend to utilise productive activities in very different ways.
ii. Overhead costs that are not incurred at the unit level create product-costing problems because they do not vary with measures such as direct labour hours or machine hours.
iii. Product diversity exists when a single product, such as pens, are made in different colours.
Which of the above statement/s is/are true?

• A) i
• B) ii
• C) i and ii
• D) i and iii

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Definitions:

Wage Rate

The fixed amount of compensation paid to an employee by an employer in exchange for work performed, typically expressed per hour, day, or piece produced.

Monopsonistic Employer

An employer with significant market power in hiring, enabling it to set wages below competitive levels.

Demand-Enhancement Union Model

A theoretical framework suggesting that labor unions can increase the demand for the products produced by their members, not just seek higher wages.

Monopsony Power

The market power possessed by a single buyer to influence the price at which they purchase goods or services, often leading to lower prices for sellers.