The Manager of Paul's Fruit and Vegetable Store Is Considering

question 102

Multiple Choice

The manager of Paul's fruit and vegetable store is considering the purchase of a new seedless watermelon from a wholesale distributor. Since this seedless watermelon costs $4, will sell for $7, and is highly perishable, he only expects to sell between 6 and 9 of them. What is the opportunity loss for purchasing 6 watermelons when the demand is for 8 watermelons?

• A) 0
• B) 3
• C) 4
• D) 6

Understand the distinction between microeconomics and macroeconomics contexts.

Appreciate the limitations of GDP as a measure of economic well-being and quality of life.

Explain the relationship between production, income, and expenditure in an economy.

Understand the components and calculation of disposable personal income.

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Definitions:

Machinery

Physical assets used in a business operation to manufacture or produce goods.

Gain on Disposal

Gain on disposal refers to the financial profit made from selling an asset for more than its carrying amount on the books.

Market Value

The current price at which an asset or service can be bought or sold in an open market.

Book Value

The book value of an asset is its value on a balance sheet, calculated by subtracting any depreciation, amortization, or impairment costs from its original cost.