Jacob and Mason Go to a Diner That Sells Burritos

question 142

Multiple Choice

Jacob and Mason go to a diner that sells burritos for $5 and tacos for $3. They agree to split the lunch bill evenly. Mason chooses a taco. The marginal cost to Jacob of ordering a burrito instead of a taco is

• A) $1.
• B) $2.
• C) $2.50.
• D) $3.

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Definitions:

Advertising Budget

The sum of funds designated for the promotion of a brand, product, or service within a certain time frame.

Net Operating Income

A company's profit after subtracting operating expenses, excluding interest and taxes.

Monthly Sales

The total revenue generated from the sale of goods or services in one month.

Unit Contribution Margin

The gap between the price per unit at which an item is sold and its per-unit variable expense.