You Can Manufacture a Product in the US and Transfer

question 15

Multiple Choice

You can manufacture a product in the US and transfer it to Europe.If the marginal cost (MC) is $3 per unit,and the market price in Europe is $5 per unit,should the product be manufactured?

• A)No,because the net receipt of $5 is larger than the MC in the US.
• B)Yes,because the gross receipt of $3 is larger than the MC in the US.
• C)No,because the net receipt of $3 is the same as the MC in the US.
• D)Yes,because the net receipts in Europe will exceed the MC in the US.

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Definitions:

Snail-Shaped

Describing something that resembles the spiral shape of a snail's shell, often used in reference to the cochlea in the ear.

Hair Cells

Sensory cells found in the inner ear that are critical for hearing and balance, converting mechanical sound vibrations into electrical signals.

Permanent Hearing Loss

A lasting inability to hear partially or completely in one or both ears, which can result from genetic factors, aging, exposure to loud noise, or certain diseases.

Basilar Membrane

A membrane in the cochlea of the inner ear that vibrates in response to sound and plays a key role in the sense of hearing.