A Medical Clinic Has 10 Workers

question 77

Multiple Choice

A medical clinic has 10 workers.Each worker can produce a maximum of either 2 units of medical services or 5 units of secretarial services a day.One day,the firm decides it would like to produce 10 units of medical services and 30 units of secretarial services.This output level is

• A) efficient.
• B)unattainable.
• C)inefficient.
• D)costless.
• E)is attainable if the firm reduces the number of its workers.

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Definitions:

Manufacturing Overhead

All indirect costs associated with the production process, excluding direct materials and direct labor expenses.

Work in Process

Inventory that includes goods in production but not yet completed, often assessed in the manufacturing sector.

Direct Materials

The raw materials that are directly used in the manufacturing of a product, which are easily traceable to the finished product.

Additional Manufacturing Overhead

Costs incurred in the manufacturing process that are above the initially budgeted or standard manufacturing overhead costs.