Use the Following to Answer Questions

question 94

Multiple Choice

Use the following to answer questions:
Figure: The Optimal Quantity
-(Figure: The Optimal Quantity) Look at the figure The Optimal Quantity. If the marginal benefit of lawn mowing increased, the _____ curve in the figure would shift to the _____ and the optimal quantity would be _____ five lawns mowed.

• A) marginal benefit; right; more than
• B) marginal cost; right; fewer than
• C) marginal benefit; left; fewer than
• D) marginal cost; left; more than

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Definitions:

Capital Structure Weight

The proportion of debt and equity that composes a company's financing of its operations and growth, often affecting its risk and return.

Tax Rate

The extent to which the government extracts a percentage of income as taxes from businesses or people.

Market Value

The current exchange rate for acquiring or disposing of a service or asset.

Bond Issue

A financial instrument issued by a corporation or government as a way of borrowing money, where the issuer promises to pay back the face value on a specific date, along with periodic interest payments.