A company uses activity-based costing to determine the costs of its three products: A, B, and C. The budgeted cost and activity for each of the company's three activity cost pools are shown in the following table:

				Budgeted Activity
Activity Cost Pool	Budgeted Cost			Product A			Product B			Product C
Activity 1	$	86,000			7,600			10,600			21,600
Activity 2	$	61,000			8,600			16,600			9,600
Activity 3	$	114,000			4,100			2,600			3,225

Which of the following statements is true regarding this company's activity rates?

Multiple Choice

• The activity rate under the activity-based costing system for Activity 2 is $15.40.

• The activity rate under the activity-based costing system for Activity 2 is $11.49.

• The activity rate under the activity-based costing system for Activity 2 is $3.46.

• The activity rate under the activity-based costing system for Activity 2 is $2.16.

• The activity rate under the activity-based costing system for Activity 2 is $1.75.