If the Hourly Wage of U

question 89

Multiple Choice

If the hourly wage of U.S. workers is $16, the hourly wage of Mexican workers is $2, and U.S. workers produce 5 times as much output per hour as Mexican workers, then, other things equal, it would be efficient to locate production facilities in:

• A) the United States since the cost per unit of output will be higher.
• B) the United States since the cost per unit of output will be lower.
• C) Mexico since the cost per unit of output will be higher.
• D) Mexico since the cost per unit of output will be lower.

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Definitions:

Liabilities

Liabilities refer to the financial obligations or debts that a company owes, which must be paid to others.

Treasury Stock

Shares that were once part of the outstanding shares but were bought back by the company, reducing the amount of stock on the open market.

Par Value

The stated value of a bond, stock share, or coupon as designated by the issuer.

Resold

The act of selling an item or asset that has already been purchased.