Figure 142 Amit and Bree Are the Only Two Homeowners

question 38

Multiple Choice

Figure 14.2 Amit and Bree are the only two homeowners on an isolated private road.Both agree that installing street lights along the road would be beneficial and want to do so.Figure 14.2 shows their willingness to pay for different quantities of street lights, the market demand for street lights and the marginal cost of installing the street lights.
-Refer to Figure 14.2.How much is Bree willing to pay to have 4 street lights installed?

• A)$1500
• B)$1800
• C)$2700
• D)$7200

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Definitions:

Job No. 100

This is generally a specific reference to a unique job or project number within a job-order costing system, and not a widely known key term.

Work in Process

Inventory that includes goods that are in the process of being manufactured but are not yet completed.

Predetermined Overhead Rate

A predetermined overhead rate is calculated before a period begins and is used to apply manufacturing overhead costs to products based on a common activity base, such as machine hours or labor hours.

Direct Labour

The workforce directly involved in the manufacturing of products or the delivery of services, whose costs are directly attributable to the production process.