Question

4.        Which of the following is a cost that changes as the level of activity changes (best answer)?

a.	fixed costs.
b.	engineered costs.
c.	sunk costs.
d.	opportunity costs.

5.        Which of the following characterizes a time period long enough to allow management to change the level of production within the constraints of current total productive capacity?

a.	short run.
b.	medium run.
c.	long run.
d.	relevant range.

6.        Which of the following terms describes the range of activity over which the firm expects a set of cost behaviors to be consistent?

a.	irrelevant range.
b.	relevant range.
c.	short-range.
d.	long-range.

7.        Which statement is correctconcerning the learning curve function?

a.	This function shows how the amount of time required to perform a task goes up per unit as the number of units increases.
b.	This function shows how the amount of time required to perform a task goes down per unit as the number of units increases.
c.	This function shows how the amount of time required to perform a task goes up per unit as the number of units decreases.
d.	This function shows how the amount of time required to perform a task goes down per unit as the number of units decreases.

8.        Which of the following represents costs that have both a fixed and variable component?

a.	curvilinear variable.
b.	curvilinear fixed.
c.	semi-variable.
d.	semi-fixed.

        

9.        What are selling, general and administrative costs considered “sticky?”

a.	These costs increase more when sales increase than they decrease when sales decrease by the same amount.
b.	These costs increase less when sales increase than they decrease when sales decrease by the same amount.
c.	These costs increase the at the same rate when sales increase and decrease at the same rate when sales decrease by the same amount.
d.	None of the answers are correct.

10.      If all the data points were on a line, the r-square would be

a.	zero.
b.	one.
c.	two.
d.	impossible to interpret.

        

11.      A financial model is only as good as

a.	the rate of growth in the economy.
b.	the company’s operating leverage.
c.	the assumptions it uses and the data it uses.
d.	None of the answers are correct.

12.      How does cost-volume-profit analysis allows management to determine the relative profitability of a product?

a.	By highlighting potential bottlenecks in the production process.
b.	By keeping fixed costs to an absolute minimum.
c.	By determining the contribution margin and projected profits at various levels of production.
d.	By assigning costs to a product in a manner that maximizes the contribution margin.

Answer 1

4. engineered cost (b) are the cost that changes with every unit of output produced or level of activity changes

5. under the short run (a) the production within the constraints of current total productive capacity allows management to change the level of production. as the production capacity can be increased in long run period.

6. under the long range (d) the cost behaviour is consistent as the fixed cost is divided among all the units in production and therefore cost is consistent

7. learning curve describes the efficiency in the production through consistent production. thus the time decreases for every unit as the total number of units increases (b)

8. semi fixed cost represent both the fixed and variable cost component

not more than 4 parts can be answered.

sorry.

please post them seperately