Exhibit 21-3 ​

question 208

Multiple Choice

Exhibit 21-3
​

-Refer to Exhibit 21-3. The average variable cost of producing 45 units of output is

• A)$1.33.
• B)$1.60.
• C)$2.00.
• D)$2.44.
• E)$13.33.

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Definitions:

Capital Intensity Ratio

A metric used to determine the amount of assets required to generate a dollar of revenue; higher ratios indicate more assets are needed.

Accounts Payable

Financial obligations or debts owed by a company to its creditors or suppliers for goods and services received.

Net Income

Refers to the total profit of a company after all expenses and taxes have been subtracted from revenue.

Sales Decrease

A reduction in the amount of products or services sold by a business over a given period.