The Table Below Shows How Total Donations, Average Donations, Total

question 68

Multiple Choice

The table below shows how total donations, average donations, total labor costs and average labor costs vary depending on the number of employees State U hires for its fundraising activities. $$\begin{array} { | c | c | c | c | c | } \hline \begin{array} { c } \text { Number of } \\\text { Employees }\end{array} & \begin{array} { c } \text { Total } \\\text { Donations }\end{array} & \begin{array} { c } \text { Average } \\\text { Donations }\end{array} & \begin{array} { c } \text { Total } \\\text { Labor Costs }\end{array} & \begin{array} { c } \text { Average } \\\text { Labor Costs }\end{array} \\\hline 1 & \$ 30,000 & & & \$ 8,000 \\\hline 2 & \$ 42,426 & & \$ 17,000 & \\\hline 3 & & \$ 17,321 & \$ 27,000 & \\\hline 4 & \$ 60,000 & & & \$ 9,500 \\\hline 5 & & \$ 13,416 & \$ 50,000 & \\\hline\end{array}$$ The net benefit of hiring fundraisers is largest when ______ employees are hired.

• A)4
• B)3
• C)2
• D)1

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Definitions:

Price Discrimination

A selling strategy that charges customers different prices for the same product or service, not justified by differences in cost.

Clayton Act

A U.S. antitrust law aimed at promoting competition and preventing monopolies by addressing specific practices deemed harmful to competition.

Meeting-The-Competition Defense

A defense to the Clayton Act in which a firm engages in price discrimination to compete in good faith with another seller’s low price.

Rule-Of-Reason Test

A legal principle that evaluates business practices based on their overall impact on competition rather than deeming them inherently illegal.