All individual cost items included in the dependent variable should have ________.
A) a different cost driver
B) an independent relationship with the independent variable
C) an economically plausible relationship with the cost driver
D) a heterogeneous cost pool

Question

Quizplus · Accepted Answer

All individual cost items included in the dependent variable should have an economically plausible relationship with the cost driver. This helps ensure that the costs being measured are relevant and meaningful to the decision-making process. Having a different cost driver for each cost item is not necessary, nor is an independent relationship with the independent variable. A heterogeneous cost pool may be appropriate, but it is not a requirement for individual cost items.

All Individual Cost Items Included in the Dependent Variable Should