Consider the Following Production and Cost Schedule for a Firm

question 113

Multiple Choice

Consider the following production and cost schedule for a firm.The first column shows the number of units of a variable factor of production employed by the firm. $$\begin{array} { | c | c | c | } \hline \begin{array} { c } \text { Total Numb er of } \\\text { Units of theF actor }\end{array} & \begin{array} { c } \text { Total Number of } \\\text { Units of Output }\end{array} & \begin{array} { c } \text { Price per Unit } \\\text { of Output }\end{array} \\\hline 10 & 20 & \$ 10 \\\hline 11 & 44 & \$ 10 \\\hline 12 & 64 & \$ 10 \\\hline 13 & 78 & \$ 10 \\\hline 14 & 84 & \$ 10 \\\hline 15 & 86 & \$ 10 \\\hline\end{array}$$ TABLE 13- 1
-Refer to Table 13- 1.The marginal revenue product of the 14th unit of the factor is

• A)$700.
• B)- $60.
• C)$140.
• D)$60.
• E)$840.

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Definitions:

Common Stock

A type of security that represents ownership in a corporation, giving holders the right to vote on corporate matters and receive dividends.

Significant Influence

The power to participate in the financial and operating policy decisions of an investee but not control those policies. It is often evidenced by ownership of 20% to 50% of the voting stock of the investee.

Net Income

The residual financial gain of a company post all expenditures and taxes being deducted from its revenues.

Book Value

The value left over from a company’s assets once its obligations are deducted, as listed on the balance sheet.