In the Specific Factors Model, a 5% Increase in the Price

question 3

Multiple Choice

In the specific factors model, a 5% increase in the price of food accompanied by a 5% increase in the price of cloth will cause ________ in the welfare of labor, ________ in the welfare of the fixed factor in the production of food, and ________ in the welfare of the fixed factor in the production of cloth.

• A) a decrease; an increase; an increase
• B) a decrease; a decrease; a decrease
• C) no change; no change; no change
• D) an increase; a decrease; a decrease
• E) an increase; an increase; an increase

Determine the most profitable sales mix for a company based on production capacity, selling prices, and variable costs.

Calculate markup percentages and price determination based on total costs.

Evaluate make or buy decisions considering relevant costs.

Identify costs not relevant to specific financial decisions.