Multiple Choice
Which of the following statements related to assumptions about estimating linear cost functions is FALSE?
A) Variations in a single cost driver explain variations in total costs.
B) A cost object is anything for which a separate measurement of costs is desired.
C) A linear function approximates cost behavior within the relevant range of the cost driver.
D) A high correlation between two variables ensures that a cause-and-effect relationship exists.
Correct Answer:
Verified
Correct Answer:
Verified
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