A cost center is
a. evaluated based on minimizing costs within the division
b. evaluated based on maximizing costs within the division
c. evaluated based on minimizing profits generated by the division
d. evaluated based on maximizing profits generated by the division
a
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Ignoring any supply-side effects, to close an inflationary gap of $100 billion with a government expenditure multiplier of 5, the government could
A) decrease government expenditure on goods and services by $20 billion. B) decrease government expenditure on goods and services by $100 billion. C) lower taxes by $100 billion. D) increase government expenditure on goods and services by $20 billion. E) lower taxes by more than $20 billion.
In the figure above, if the firm is regulated using an average cost pricing rule, the economic loss created is equal to the area of
A) ABG. B) BEFG. C) BCFG. D) BCE. E) None of the above because there is no economic loss created.
Which of the following would not cause the consumption-income line to shift upward?
a. An increase in income b. An increase in autonomous consumption c. A decrease in the interest rate d. Greater optimism about economic conditions e. An increase in household wealth
Employers in a city must pay a specific tax of $t per hour worked by their employees while employers in the suburbs of the city do not have an employment tax. What does a general equilibrium approach predict regarding the wages and employment of both the city and suburban workers if the city decides to substantially reduce their employment tax rate?
A) Wages will increase in the city, but not in the suburbs, and employment will increase in both. B) Wages will increase in both the city and the suburbs, but employment will fall in both. C) Wages will increase in both the city and suburbs, employment will increase in the city, but decrease in the suburbs. D) Wages will increase in both the city and the suburbs, employment will decrease in the city, but increase in the suburbs.