Table 18-9 -Refer to Table 18-9.This Table Describes the Number of Baseballs

question 433

Multiple Choice

Table 18-9

-Refer to Table 18-9.This table describes the number of baseballs a manufacturer can produce per day with different quantities of labor.Each baseball sells for $2.50 in a competitive market and the firm pays each unit of labor a wage equal to $225 per day.How many units of labor should the firm hire to maximize profit?

• A) 2 units
• B) 3 units
• C) 4 units
• D) 5 units

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Definitions:

Net Income

The total profit of a company after all expenses, including taxes and interest, have been deducted from total revenue.

Dividend Payout Ratio

The percentage of earnings paid to shareholders in the form of dividends, calculated by dividing total dividends by net income.

Earnings Per Share

A financial metric that measures a company's profitability by dividing its net income by the number of outstanding shares of its common stock.

Contribution Margin

The amount remaining from sales revenue after variable expenses have been deducted; it contributes towards covering fixed costs and generating profit.