Three Identical Units of Merchandise Were Purchased During March, as Shown

question 77

Multiple Choice

Three identical units of merchandise were purchased during March, as shown: Assume that one unit is sold on March 23 for $1,125. What is the ending inventory on March 31 using LIFO.

• A)$245
• B)$295
• C)$1,670
• D)$1,720

Understand the role of equilibrium in maximizing total surplus in a market.

Describe the implications of trade policies on the international exchange of goods and the domestic economy.

Interpret market equilibrium from a supply and demand graph.

Analyze the changes in consumer and producer surplus due to shifts in market price.

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Definitions:

AVC (Average Variable Cost)

The total variable cost divided by the quantity of output produced; it varies with production.

MC (Marginal Cost)

Marginal Cost is the change in total cost that arises when the quantity produced is incremented by one unit.

Shutdown Point

The level of operations at which a company or business does not generate enough revenue to cover its variable costs, leading to a temporary or permanent closure.

AVC (Average Variable Cost)

The total variable costs (costs that vary with the level of output) divided by the quantity of output produced, representing the variable cost per unit.