Exhibit 7-2 Given the Information in Exhibit 7-2, What

question 63

Multiple Choice

Exhibit 7-2 Given the information in Exhibit 7-2, what is the average product of the fourth unit of labor?

• A)5 pairs of shoes
• B)10 pairs of shoes
• C)20 pairs of shoes
• D)50 pairs of shoes
• E)80 pairs of shoes

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Definitions:

Money

Anything that is generally accepted in exchange for goods and services.

Capital

Assets used for the production of goods and services, including machinery, buildings, and equipment.

Economics

The social science that studies how individuals, governments, firms, and nations make choices on allocating scarce resources to satisfy their unlimited wants.

Profit

The financial gain obtained when the revenues generated from business activities exceed the expenses, costs, and taxes involved in sustaining the activity.