Refer to the Following

question 42

Multiple Choice

Refer to the following:
"At Huffy's ... bicycle factory, 1,700 employees turn out 15,000 bicycles a day (in 1987) . Five years ago, it required 2,200 workers to make 10,000 bikes daily." (The Wall Street Journal) .
-In 1987,

• A) total product was 15,000 bicycles per day.
• B) the average product of labor was 0.11.
• C) the marginal product of labor was 8.8.
• D) both a and b
• E) both a and c

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Definitions:

Net Income

The total earnings of a person or organization after subtracting all expenses and taxes.

Variable Costs

Costs that change in proportion to the level of activity or volume of production in a company.

Fixed Costs

Expenses that do not change in proportion to the activity of a business, such as rent, salaries, and insurance.

Variable Costs

Costs that change in proportion to the level of activity or volume of production.