Which of the Following Statements Is True Concerning Cost Estimation

question 48

Multiple Choice

Which of the following statements is true concerning cost estimation methods?

• A) Cost behaviour is always assumed to depend on more than one cost driver.
• B) Cost behaviour patterns are curvilinear.
• C) Costs and benefits of using sophisticated and costly cost-estimation methods must be evaluated.
• D) Cost behaviour is always assumed to depend on more than one cost driver AND costs and benefits of using sophisticated and costly cost-estimation methods must be evaluated.

---

Definitions:

Control Limits

These are thresholds set in statistical process control that indicate the bounds of acceptable performance, identifying when a process is out of control.

Sample Size

The number of individuals or observations included in a sample, which represents a subset of a larger population.

Standard Deviation

An indicator of the range or spread of values in a dataset, showing how much the values differ from the average.

Proportion

A part, share, or number considered in comparative relation to a whole.