It Is Efficient to Produce an Additional Shirt If the

question 92

Multiple Choice

It is efficient to produce an additional shirt if the

• A)marginal social benefit from producing the shirt exceeds zero.
• B)marginal social benefit of producing the shirt equals zero.
• C)consumer surplus from the additional shirt exceeds its producer surplus.
• D)marginal social benefit from producing the shirt is greater than the marginal social cost of producing it.
• E)producer surplus from the additional shirt exceeds its consumer surplus.

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Definitions:

GAAP

Generally Accepted Accounting Principles; the common set of accounting standards and procedures used in the U.S. to compile financial statements.

Revenue Recognition

A principle within accounting that determines the specific conditions under which revenue is recognized or accounted for.

Overtime Wages

Additional pay granted to employees for hours worked beyond their standard scheduled hours.

Expensed

Recorded as an expense in the financial statements in the period in which it is incurred.