Refer to the Diagram

question 167

Multiple Choice

Refer to the diagram. The marginal utility of the third unit of X is

• A) 5.
• B) 4.
• C) 2.
• D) 15.

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Definitions:

Straight-Line Depreciation

A method of allocating the cost of a tangible asset over its useful life in equal annual amounts, resulting in a constant annual charge.

Capital Budgeting

The approach of examining and picking out long-term investments congruent with the aim of enhancing shareholder wealth.

Straight-Line Depreciation

A technique for determining the depreciation of an asset that evenly spreads its cost over its lifespan.

Capital Budgeting

The process by which a business determines and evaluates potential large expenses or investments.