Average Product Measures

question 113

Multiple Choice

Average product measures:

• A)the quantity of output produced per unit of input.
• B)the additional output created from an additional unit of input.
• C)marginal product averaged across all inputs.
• D)All of these are correct.

---

Definitions:

Discount Rate

In discounted cash flow analysis, this interest rate is crucial for deducing the present monetary value of cash inflows expected in future periods.

Net Present Value

The difference between the present value of cash inflows and outflows over a period, used to assess the profitability of an investment.

Working Capital

The disparity between a business's immediate assets and liabilities, showcasing its liquidity and financial stability in the short-term.

Salvage Value

The estimated resale value of an asset at the end of its useful life, considered in depreciation calculations and asset disposal decisions.