-Sun's Gas Station Is a Firm Operating in a Perfectly

question 59

Multiple Choice

-Sun's Gas Station is a firm operating in a perfectly competitive industry. Sun's Gas Station sells each gallon of gas for $3. What is the marginal product from hiring the fourth worker?

• A) 70 gallons of gasoline
• B) 280 gallons of gasoline
• C) 40 gallons of gasoline
• D) 80 gallons of gasoline

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Definitions:

Required Rate

Also known as the Required Rate of Return, it is the minimum annual percentage return an investor expects to achieve from an investment.

Discounted Payback

The period of time required to recoup the cost of an investment considering the time value of money through discounted cash flows.

Financial Basis

The underlying value or criteria used for accounting or financial management purposes, often referred to as the method of recognizing revenues and expenses.