A Staff Assistant at Warrington Corporation Recently Determined That the First

question 3

Multiple Choice

A staff assistant at Warrington Corporation recently determined that the first five units completed in a new manufacturing process took 500 hours to complete, or an average of 100 hours per unit. The assistant also found that when the cumulative output produced doubles, the average labor time declines by 20%. On the basis of this information, how many total hours would Warrington use if it produces a cumulative amount of 40 units?

• A) 128.
• B) 160.
• C) 1,280.
• D) 2,048.
• E) None of the answers is correct.

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Definitions:

Consumer Surplus

The difference between the maximum amount consumers are willing to pay for a good or service and the actual amount they do pay.

Tax Revenue

The wealth accumulated by governments through the process of taxation.

Consumer Surplus

Consumer surplus is the difference between the total amount consumers are willing and able to pay for a good or service and the total amount they actually pay.

Tax Revenues

The income received by the government from taxes imposed on individuals and businesses, used to fund government activities and public services.