Answer the following statements true (T) or false (F)
1. Variable costing prepares the income statement using the traditional format.
2. The contribution margin format of the income statement categorizes costs by their behavior.
3. The fixed manufacturing overhead is considered a product cost in variable costing and a period cost
in absorption costing.
4. Variable costing considers direct materials, direct labor, variable manufacturing overhead, and fixed
manufacturing overhead as product costs.
5. The level of inventory on hand at the end of the year does not affect the amount of operating income
calculated under variable costing and absorption costing.
1. FALSE
2. TRUE
3. FALSE
4. FALSE
5. FALSE
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Consider the bond market to be in equilibrium according to our complete theory of the term structure of interest rates. The current interest rate on one-year bonds is 2 percent, and you believe, as does everyone in the market, that in one year the interest rate on one-year bonds will be 3 percent, and in two years, the interest rate on one-year bonds will be 4 percent. That is, using our standard notation,
= 2%, 
= 3%, and 
= 4%.Assume that there is no term premium on a one-year bond.
a.According to the expectations theory of the term structure of interest rates, what will the interest rate be today on a two-year bond and a three-year bond??
Suppose the term premium equals 0.75 percent × the number of years to maturity, for the 2-year bond and the 3-year bond.
?
b.Calculate the interest rate today on the two-year bond and the three-year bond, incorporating the term premium. c.Draw the yield curve for today, using the values you calculated in part b. Your drawing should show three points and should be drawn reasonably to scale, showing the values on each axis of each point plotted. Explain briefly (in one or two sentences) why the yield curve has the shape it does.
What will be an ideal response?
An act must substantially affect interstate commerce to violate antitrust law
a. True b. False Indicate whether the statement is true or false
Cases concerning the application of the U.S. Constitution are federal questions within the power of the federal courts
a. True b. False Indicate whether the statement is true or false
After many years of distributing her clothing through a large chain of department stores, Georgia, a fashion designer, decides to open a boutique to exclusively sell her clothing directly to consumers. Georgia is following a(n) ________ strategy.
A. forward vertical integration B. concentration on a single industry C. forward horizontal integration D. unrelated diversification E. backward vertical integration