Use the Following to Answer Question

question 85

Multiple Choice

Use the following to answer question:
-(Table: Demand Schedule of Gadgets) Use Table: Demand Schedule of Gadgets.The market for gadgets consists of two producers,Margaret and Ray.Each firm can produce gadgets at a marginal cost of $2 and no fixed cost.If industry output is 300 gadgets produced by Margaret and 200 gadgets produced by Ray and if Ray decides to increase output by an additional 100 gadgets,Margaret's profit will be _____,and Ray's profit will be _____.

• A)$1,750;$1,250
• B)$1,250;$1,250
• C)$1,400;$1,000
• D)$600;$600

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Definitions:

Equity Method

An accounting technique used by a company to record investments in other companies where it has significant influence but does not have full control.

Consolidated Financial Statements

Financial statements that combine the financial information of a parent company with its subsidiaries to present a single set of statements for the entire group.

FVTPL

Fair Value Through Profit or Loss, an accounting strategy whereby financial assets are valued at their current market price, with changes in fair value recorded in the profit or loss statement.

Equity Method

An accounting technique used by a company to record its investment in another company when it has significant influence but not complete control.