The Relationship Between Cost and Activity Is Called

question 85

Multiple Choice

The relationship between cost and activity is called:

• A) cost prediction.
• B) cost behaviour.
• C) cost analysis.
• D) cost approximation.

---

Definitions:

Required Rate

The minimum annual percentage return on an investment that an investor aims for, considering the investment's risk.

Retaining Earnings

Profits that a company reinvests in itself instead of paying out to shareholders as dividends.

Flotation Costs

Those costs occurring when a company issues a new security, including fees to an investment banker and legal fees.

New Common Shares

Issuance of additional shares of a company's stock, which can dilute existing shareholders' equity but raise new capital for the company.