Situation 26-1 a Company Is Trying to Decide Whether It

question 46

Multiple Choice

Situation 26-1 A company is trying to decide whether it should produce good X in the U.S. or in Mexico.  Suppose a U.S. worker earns $15 per hour and a worker in Mexico earns $4 per hour.  Also suppose that the marginal physical product (MPP) of the U.S. worker is 12 units of good X and the MPP of the Mexican worker is 3 units of good X.
Refer to Situation 26-1. If good X is produced in the U.S. the output per $1 of cost would be ___________________ than if good X were produced in Mexico, thus it would be best to produce good X in

• A)higher; Mexico.
• B)lower; Mexico.
• C)higher; the United States.
• D)lower; the United States.

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Definitions:

Nonfinancial Rewards

Benefits provided to employees that do not involve monetary compensation, such as recognition, flexible working hours, and professional development opportunities.

Corporate America

A colloquial term referring to the United States' business sector, particularly large companies and corporations.

Comparable Level

A standard of measurement or quality used to compare the attributes of products, services, or performance.

Mental Stamina

The ability to sustain prolonged mental effort required to overcome obstacles or to navigate difficult or complex situations.