For Questions Refer to the Following Information:
a $$P = 24 - 0.0004 Q _ { d }$$

question 5

Multiple Choice

For Questions refer to the following information:
A municipal water utility employs quasi-fixed capital inputs-are the water treatment plant and distribution lines to homes-to supply water to 20,000 households in the community it serves. The figure below shows the cost structure of this utility for various levels of water service. Quantity of water consumption is measured in 1,000-gallon units per month. AQFC is the average quasi-fixed cost curve, and LAC is long-run average cost. Long-run marginal cost, LMC, is constant and equal to $4 per 1,000-gallon unit. The inverse demand equation is $$P = 24 - 0.0004 Q _ { d }$$ .
-The value in blank d in the figure is ____.

• A) 6.50
• B) 7.50
• C) 8.00
• D) 9.50
• E) none of the above

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Definitions:

Goodwill

An intangible asset that arises when a business is purchased for more than the fair value of its net identifiable assets, representing elements like reputation, customer loyalty, etc.

AASB 3

An accounting standard issued by the Australian Accounting Standards Board that deals with the accounting requirements for business combinations.

Business Combination

A transaction or other event in which an acquirer gains control of one or more businesses.

Fair Value Adjustments

Amendments made to the book value of assets or liabilities to align them with their fair value.