Use the Following to Answer Questions: Table: Two Factories -Table: ABC & XYZ

question 125

Multiple Choice

Use the following to answer questions: Table: Two Factories $$\begin{array} { c c c c } \hline \text { Output }& \begin{array} { c } \text { Factory l } \\\text { Marginal } \\\text { Output }\end{array} & \text { Output } & \begin{array} { c } \text { Factory 2 } \\\text { Marginal } \\\text { Cost }\end{array} \\\hline 0 & - & 0 & - \\1 & \$ 1.00 & 1 & \$ 0.50 \\2 & 2.00 & 2 & 1.00 \\3 & 3.00 & 3 & 1.50 \\4 & 4.00 & 4 & 2.00 \\5 & 5.00 & 5 & 2.50 \\6 & 6.00 & 6 & 3.00 \\\hline\end{array}$$
-Table: ABC & XYZ $$\begin{array} { c c c } \hline \boldsymbol { Q } & \boldsymbol { M C } \text { of ABC, Co. } & \boldsymbol { M C } \text { of XYZ, Inc. } \\\hline 0 & - & - \\1 & \$ 5 & \$ 4 \\2 & 10 & 8 \\3 & 20 & 12 \\4 & 25 & 16 \\5 & 30 & 20 \\6 & 35 & 24 \\7 & 40 & 30 \\8 & 45 & 35 \\\hline\end{array}$$ Refer to the table. What price should the firms in this table charge for them to produce 12 units of total output?

• A) $45
• B) $20
• C) $30
• D) $24

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Definitions:

Perpetual Inventory System

The perpetual inventory system continuously updates inventory records for each purchase and sale transaction, providing real-time inventory levels.

Financial Statements

Formal records of the financial activities and position of a business, person, or other entity, typically including a balance sheet, income statement, and cash flow statement.

Allowance Method

An accounting method used to estimate and deduct accounts receivable that are deemed to be uncollectible.

Uncollectible Accounts

Accounts receivable that are considered irrecoverable and are written off as a loss by a business.