Question
Part 1: With a step fixed-cost function ________. A) fixed cost changes proportionally with the level of activity B) the cost varies with the changes
Part 1: With a step fixed-cost function ________.
A) fixed cost changes proportionally with the level of activity
B) the cost varies with the changes in the activity
C) fixed cost is often approximated with a continuous variable-cost function
D) the cost remains the same over wide ranges of the activity in each relevant range
Part 2: The ideal database for estimating cost functions contains ________.
A) only the independent variable and not the dependent variable
B) numerous cost driver observations
C) cost driver observations spanning a narrow range
D) a few values of the cost driver that are grouped closely together
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