A cost function
A) need not have a cause-and-effect relationship.
B) should include only personal observations of costs and activities.
C) does not explain past cost behaviour.
D) should be a reliable predictor of future costs.

Question

Quizplus · Accepted Answer

A cost function should be able to provide a reliable estimate of future costs based on past cost behavior. A cost function with no cause-and-effect relationships would not be able to do so. Additionally, a cost function should not be limited to personal observations, and it can also help explain past cost behavior.

A Cost Function