Suppose Jodi's Widget Business Is Using Two Inputs,labour and Capital

question 35

Multiple Choice

Suppose Jodi's widget business is using two inputs,labour and capital.If the price of labour increases,which of the following will happen?

• A)Jodi will shut down her business.
• B)The firm's average total cost curve will shift upward.
• C)The firm's marginal cost curve will remain unchanged.
• D)Jodi will hire more labour.
• E)The firm's average fixed cost curve will shift upward.

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Definitions:

EVA

Economic Value Added is a measure of a company's financial performance based on the residual wealth calculated by deducting its cost of capital from its operating profit, adjusted for taxes on a cash basis.

Net Income

Net income is the total profit of a company after all expenses, taxes, and costs have been subtracted from total revenue.

Operating Income

The profit realized from a business's core operations, excluding deductions of interest and taxes.

Market-Based Income

Income generated from investments in the financial markets, such as stocks, bonds, or other assets.