-Refer to the Above Table

question 184

Multiple Choice

-Refer to the above table. Assuming constant opportunity costs, the opportunity cost of producing a computer in the United States is ________ while the opportunity cost of producing a computer in Mexico is ________.

• A)0.8 bicycle; 2 computers
• B)2.5 computers; 0.25 bicycle
• C)0.5 bicycle; 0.2 bicycle
• D)2 bicycles; 5 bicycles

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Definitions:

Net Income

The amount of money left after all expenses, taxes, and deductions have been subtracted from total revenue.

CVP Analysis

Cost-Volume-Profit Analysis, a method used in managerial accounting to understand the impact of varying levels of costs and volume on operating profit.

Variable Cost

Expenses that vary directly with the amount of products or services a company generates.

Fixed Costs

Costs that remain constant regardless of a company's level of activity, including expenses like rent, salaries, and insurance.