At an Activity Level of 8,400 Units in a Month

question 24

Multiple Choice

At an activity level of 8,400 units in a month, Braughton Corporation's total variable maintenance and repair cost is $697,284 and its total fixed maintenance and repair cost is $464,100. What would be the total maintenance and repair cost, both fixed and variable, at an activity level of 8,500 units in a month? Assume that this level of activity is within the relevant range. (Round intermediate calculations to 2 decimal places.)

• A) $1,175,210
• B) $1,169,685
• C) $1,161,384
• D) $1,168,297

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Definitions:

Government Failure

Occurs when government intervention in the economy causes more harm than good, leading to inefficiencies or unintended negative consequences.

Idealized Economic Efficiency

A theoretical state in which resources are allocated in the most effective way possible, maximizing productivity while minimizing waste and inefficiencies.

Externality

A consequence of an industrial or commercial activity which affects other parties without this being reflected in market prices.

Uncompensated Benefits

Benefits that occur from an economic transaction that affect individuals not directly involved in the transaction, not compensated by the market.