Situation 26-2 A Company Is Trying to Decide Whether It Should Produce

question 120

Multiple Choice

Situation 26-2
A company is trying to decide whether it should produce good Y in the U.S. or in Mexico. Suppose a U.S. worker earns $12 per hour and a worker in Mexico earns $4 per hour. Also suppose that the marginal physical product (MPP) of the U.S. worker is 10 units of good Y and the MPP of the Mexican worker is 5 units of good Y.
-Refer to Situation 26-2. The output produced per $1 of cost in the Mexico. is

• A)1.25 units of good Y.
• B)0.80 units of good Y.
• C)9.0 units of good Y.
• D)1.0 units of good Y.

---

Definitions:

Inter-Tribal Wars

Conflicts that occur between different tribal groups, often related to issues such as territory, resources, or political dominance.

Europeans

People hailing from Europe, a continent located entirely in the Northern Hemisphere and mostly in the Eastern Hemisphere, known for its rich history, varied cultures, and significant influence on global affairs.

Mediterranean World

Refers to the regions surrounding the Mediterranean Sea, encompassing diverse cultures, histories, and significant developments in trade, exploration, and cultural exchange.

Columbus

An Italian explorer, Christopher Columbus, known for his 1492 voyage that led to the discovery of the Americas by Europeans.