Weisbach Electronics Is Considering Investing in India

question 17

Multiple Choice

Weisbach Electronics is considering investing in India.Which of the following factors would make the company less likely to proceed with the investment?

• A) The company would have the option to withdraw from the investment after 2 years if it turns out to be unprofitable.
• B) The investment would increase the odds of the company being able to subsequently make a successful entry into China.
• C) The investment would preclude the company from being able to make a profitable investment in China.
• D) Competitors are considering similar investments in India,and the firm can discourage them from trying by entering now.
• E) The new plant could be easily retrofitted to manufacture many of the firm's other products.

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Definitions:

Marginal Product

The additional output that can be produced by adding one more unit of a specific input, holding all other inputs constant.

Value Of Marginal Product

describes the additional revenue generated from employing one more unit of input, such as labor or capital.

Wage Rate

The amount of compensation a worker receives per unit of time or per task performed, often expressed per hour or per piece.

Supply Of Labor

The total number of workforce hours available for work in an economy at a given wage rate.