The Following Table Illustrates Alternative Production Techniques for Producing 18

question 183

Multiple Choice

The following table illustrates alternative production techniques for producing 18 widgets that can be sold for $1 each for a total revenue of $18. If the price of labor increases from $2 to $3, then the results of using Technique C will change from an economic

• A)loss of $2 to a loss of $1.
• B)profit of $2 to a profit of $1.
• C)profit of $1 to a profit of $2.
• D)loss of $1 to a loss of $2.

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Definitions:

Debt/Assets Ratio

A financial ratio that indicates the proportion of a company's assets that are financed by debt.

Common Equity

The amount of ownership interest that is common stockholders have in a company, reflecting their equity stake.

Borrow

The act of receiving funds from a lender with the agreement to return the principal amount along with interest or other charges, if applicable.

Assets

Economic resources owned or controlled by a person or entity that are expected to produce value or benefit in the future.