5. when increased raw material costs increase prices for consumers, the situation is known as inflation. a. monetary b. demand-pull c. cost-push d. law of supply 6. what's the term for the idea that there aren't enough resources to satisfy everyone's wants and needs? a. demand b. consumer c. scarcity d. supply 7. the states that more of an item will be purchased at a lower price than at a higher price. a. law of demand b. law of economics c. law of elasticity d. law of supply 8. what might cause a consumer to have an elastic demand for a product? a. the product isn't a necessity. b. the product was produced outside of the united states. c. the product is a necessity. d. the product is priced at $5. 9. consumer tastes or preferences would be most likely to have an effect on a. elasticity. b. the law of supply. c. demand. d. supply.

Activity-based costing (abc) is not truly a cost collection mechanism as much as it is an inventory valuation method. the main purpose for implementing an activity-based cost system is to try to overcome some of the cost distortions that occur in traditional costing from product differences when there are variations in size and complexity. however, one of the disadvantages of utilizing abc is that the additional information gathering necessary to implement costing with that level of detail might be beyond the reach of some companies with resource or financial constraints. with this in mind, what kinds of industries or companies do you think would benefit most from using activity-based costing and why? in designing or modifying an accounting system to capture appropriate costs for abc, what considerations do you think would need to be made?