At the End of 20X1, Gilley Company Implemented a New

question 109

Multiple Choice

At the end of 20X1, Gilley Company implemented a new labour process and redesigned its product with the expectation that input usage efficiency would increase. Now, at the end of 20X2, the president of the company wants an assessment of the changes on the company’s productivity. The data needed for the assessment are as follows:
$\begin{array}{lrr}&20 \times 1 & 20 \times 2\\\text { Output } & 30,000 & 36,000 \\\text { Output prices } & \$ 10 & \$ 10 \\\text { Materials (kg) } & 15,000 & 15,300 \\\text { Materials unit price } & \$ 3 & \$ 4 \\\text { Labour (hrs.) } & 12,000 & 11,250 \\\text { Labour rate per hour } & \$ 5 & \$ 5 \\\text { Power (kwh) } & 7,500 & 9,750 \\\text { Price per kwh } & \$ 2 & \$ 3\end{array}$
-Refer to the figure.By how much did profit change as a result of profitability changes in labour?

• A)$3,750 increase
• B)$15,750 decrease
• C)$15,750 increase
• D)$30,000 increase

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Definitions:

Archetype

In psychology, particularly Jungian theory, archetypes are universally understood symbols, terms, or behaviors inherent in the collective unconscious.

Behavior

Observable actions or responses of individuals or groups, which can be influenced by internal or external factors.

Influence

The capacity to have an effect on the character, development, or behavior of someone or something.

Jungian Theory

A psychological approach developed by Carl Jung focusing on the collective unconscious, archetypes, and the process of individuation.