What Is Meant by the Gross Marginal Productivity of an Investment

question 24

Multiple Choice

What is meant by the gross marginal productivity of an investment?

• A)It is the total addition to productivity contributed by capital investment.
• B)It is the addition to total revenue from the sale of an extra unit of output.
• C)It is the increase in production by proportionately increasing all inputs.
• D)It is the increase in the average product from an extra unit of capital investment.

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Definitions:

Realized Profits

The gains earned and received from the sale of assets or investments.

Tax Rate

The rate at which a person or company is taxed by the state.

Unrealized

Referring to profits or losses that have occurred on paper due to changes in the value of assets or investments but have not been actualized through a sale or transaction.

Intercompany Profits

Earnings generated from transactions between divisions or subsidiaries within the same corporation, which may be eliminated in consolidated financial statements.