Economists Reason That the Optimal Decision Is to Continue Any

question 89

Multiple Choice

Economists reason that the optimal decision is to continue any activity up to the point where the

• A)marginal benefit is zero.
• B)marginal benefit is greater than the marginal cost.
• C)marginal cost is zero.
• D)marginal benefit equals the marginal cost.

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Definitions:

Direct Labor-Hour

A unit of measure for the time spent by workers on producing a specific number of goods.

Machining Department

A segment within a manufacturing facility where machining, a process of removing material from a workpiece to create desired shapes and features, takes place.

Machine-Hour

A unit of measure indicating the time a machine is operated to produce goods, often used in allocating manufacturing overhead.

Job Cost

The total cost assigned to a specific job or project, comprising direct materials, direct labor, and allocated overhead.