Nitin and Sam Have Invested in a Partnership in the Ratio

question 252

Multiple Choice

Nitin and Sam have invested in a partnership in the ratio of 3:5. If Sam adds another $10,000 to the business, how much should Nitin invest in order to maintain the same ratio?

• A) $10,000
• B) $3,000
• C) $5,000
• D) $6,000
• E) $12,000

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Definitions:

Value of Marginal Product

The additional revenue generated by employing one more unit of a factor of production, holding all other factors constant.

Profit

The financial gain achieved when the revenue earned from a business activity exceeds the expenses, costs, and taxes needed to sustain the activity.

Wage

Payment to a worker from an employer for labor or services, usually expressed as an hourly, daily, or piece rate.

Marginal Revenue

The change in total revenue from an additional unit sold.