{"id":52503,"date":"2024-04-15T23:40:20","date_gmt":"2024-04-15T23:40:20","guid":{"rendered":"https:\/\/exam.pscnotes.com\/mcq\/?p=52503"},"modified":"2024-04-15T23:40:20","modified_gmt":"2024-04-15T23:40:20","slug":"in-cause-and-effect-relationship-between-cost-level-and-cost-driver-inflationary-price-effects-are-removed-by-dividing-cost-through","status":"publish","type":"post","link":"https:\/\/exam.pscnotes.com\/mcq\/in-cause-and-effect-relationship-between-cost-level-and-cost-driver-inflationary-price-effects-are-removed-by-dividing-cost-through\/","title":{"rendered":"In cause and effect relationship between cost level and cost driver, inflationary price effects are removed by dividing cost through"},"content":{"rendered":"<p>[amp_mcq option1=&#8221;price index&#8221; option2=&#8221;cost index&#8221; option3=&#8221;profit index&#8221; option4=&#8221;cost driver index&#8221; correct=&#8221;option1&#8243;]<!--more--><\/p>\n<p>The correct answer is A. price index.<\/p>\n<p>A price index is a measure of the average change over time in the prices paid by urban consumers for a market basket of consumer goods and services. It is a statistical measure of the average change over time in the prices paid by urban consumers for a market basket of consumer goods and services.<\/p>\n<p>A cost index is a measure of the average change over time in the prices of goods and services used in production. It is a statistical measure of the average change over time in the prices of goods and services used in production.<\/p>\n<p>A profit index is a measure of the average change over time in the profits of businesses. It is a statistical measure of the average change over time in the profits of businesses.<\/p>\n<p>A cost driver index is a measure of the average change over time in the costs of production. It is a statistical measure of the average change over time in the costs of production.<\/p>\n<p>In cause and effect relationship between cost level and cost driver, inflationary price effects are removed by dividing cost through price index. This is because the price index measures the average change over time in the prices of goods and services, which includes the effects of inflation. By dividing cost through the price index, we are removing the effects of inflation from the cost, and are left with the real cost.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>[amp_mcq option1=&#8221;price index&#8221; option2=&#8221;cost index&#8221; option3=&#8221;profit index&#8221; option4=&#8221;cost driver index&#8221; correct=&#8221;option1&#8243;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[952],"tags":[],"class_list":["post-52503","post","type-post","status-publish","format-standard","hentry","category-costing","no-featured-image-padding"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v22.2 (Yoast SEO v23.3) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>In cause and effect relationship between cost level and cost driver, inflationary price effects are removed by dividing cost through<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/exam.pscnotes.com\/mcq\/in-cause-and-effect-relationship-between-cost-level-and-cost-driver-inflationary-price-effects-are-removed-by-dividing-cost-through\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"In cause and effect relationship between cost level and cost driver, inflationary price effects are removed by dividing cost through\" \/>\n<meta property=\"og:description\" content=\"[amp_mcq option1=&#8221;price index&#8221; 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