Use the Figure Below to Answer the Following Question

question 115

Multiple Choice

Use the figure below to answer the following question.

Figure 5.3.4
-Refer to Figure 5.3.4. The graph shows the market for cell phones. When production is efficient, total surplus is ________ and the cost of producing the cell phones sold is ________.

• A)$2,250; $2,250
• B)$2,250; $3,000
• C)$1,500; $750
• D)$750; $1,500
• E)$1,500; $2,250

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Definitions:

Common Stockholders

Owners of common stock in a corporation, who have voting rights and may receive dividends, but are typically last in line to receive assets in the event of liquidation.

Stockholders' Equity

The residual assets of a company that belong to the shareholders, calculated as total assets minus total liabilities.

Liabilities

Financial obligations or debts that a company owes to others, reflecting amounts that must be paid in the future.

Authorized Shares

The maximum number of shares a corporation is legally allowed to issue, as stipulated in its articles of incorporation.