Table 4-3 -Refer to Table 4-3.The Table Above Lists the Marginal Cost

question 181

Multiple Choice

Table 4-3

-Refer to Table 4-3.The table above lists the marginal cost of polo shirts by Marko's,a firm that specializes in producing men's clothing.If the price of polo shirts increases from $15 to $20

• A)consumers will buy no polo shirts.
• B)the marginal cost of producing the third polo shirt will increase to $20.
• C)producer surplus will rise from $13 to $28.
• D)there will be a surplus of polo shirts.

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Definitions:

AASB 116

An Australian Accounting Standards Board standard detailing the accounting treatment for property, plant, and equipment.

IAS 16

An International Accounting Standard that prescribes the accounting treatment for property, plant, and equipment including their recognition, determination of their carrying amounts, and the depreciation charges and impairment losses to be recognized in relation to them.

Government Grants

Financial assistance from the government in the form of transfers of resources to an entity in return for past or future compliance with certain conditions relating to the operating activities of the entity.

AASB 41

The Australian Accounting Standards Board’s standard related to agriculture, which outlines how agricultural companies should account for and report their agricultural activity.