To what does the term differential cost refer?
A) A difference in cost that results from selecting one alternative instead of another.
B) The benefit forgone by selecting one alternative instead of another.
C) A cost that does not entail any dollar outlay, but which is relevant to the decision-making process.
D) A cost that continues to be incurred even though there is no activity.

Question

Quizplus · Accepted Answer

Differential cost refers to the difference in cost between two alternatives. This is relevant in decision-making as it helps in determining the most financially feasible option.

To What Does the Term Differential Cost Refer