What Is the Primary Lesson to Be Learned from the Economic

question 32

Multiple Choice

What is the primary lesson to be learned from the economic scandals of the early 21^st century?

• A) Businesses' reputations depend on their profits.
• B) Public confidence in corporate America depends on companies' bottom lines.
• C) Most businesses can focus on their bottoms lines to the exclusion of other factors.
• D) Ethical conduct and corporate social responsibility are very important.
• E) Executives who engage in misconduct are likely to get away with it if it enhances their firms' profits.

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Definitions:

Payment to Labor

Compensation provided to workers for their labor, which can be in the form of wages, salaries, or benefits, for their contribution to production processes.

Marginal Revenue Product

The additional revenue generated by employing one more unit of a factor of production, holding all other inputs constant.

Marginal Product

The increase in output that results from employing one more unit of a specific input, while holding other inputs constant.

Labor Input

The quantity of labor employed in the production of goods and services, usually measured in hours worked or number of workers.