Refer to the Table Below A)$4
B)$6
C)$8
D)$10

question 77

Multiple Choice

Refer to the table below. The average cost of 5 units of activity is: $$\begin{array} { | c | c | c | } \hline \begin{array} { c } \text { Units of } \\\text { Activity }\end{array} & \begin{array} { c } \text { Total } \\\text { Cost }\end{array} & \begin{array} { c } \text { Total } \\\text { Benefit }\end{array} \\\hline 0 & \$ 0 & \$ 0 \\\hline 1 & \$ 2 & \$ 12 \\\hline 2 & \$ 6 & \$ 22 \\\hline 3 & \$ 12 & \$ 30 \\\hline 4 & \$ 20 & \$ 36 \\\hline 5 & \$ 30 & \$ 40 \\\hline 6 & \$ 42 & \$ 42 \\\hline 7 & \$ 56 & \$ 43 \\\hline\end{array}$$

• A)$4
• B)$6
• C)$8
• D)$10

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Definitions:

Tax

Compulsory financial charge or some other type of levy imposed upon a taxpayer by a governmental organization in order to fund government spending and various public expenditures.

Capital Structure

The mix of different forms of external funds and equity used by a firm to finance its overall operations and growth.

Debt-Equity Ratio

This metric calculates the relative use of debt and shareholders' equity in financing assets for a company.

Capital Budgeting

The process used by organizations to evaluate and prioritize investments in long-term assets and projects.