At the Breakeven Point of 2,000 Units,variable Costs Total $4,000

question 7

Multiple Choice

At the breakeven point of 2,000 units,variable costs total $4,000 and fixed costs total $6,000.The 2,001st unit sold will contribute ________ to profits.

• A) $1
• B) $2
• C) $3
• D) $5

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Definitions:

Marginal Benefit

The enhanced pleasure or value a person gains upon consuming one more unit of a particular good or service.

Emissions Tax

A tax imposed on companies for the pollution they produce, intended to motivate them to reduce pollutants and adopt cleaner processes.

Pollution Emissions

Refers to the release of pollutants into the environment, which can come from various sources such as factories, vehicles, and agriculture.

Tradable Pollution Permits

Government-issued allowances that give the holder the right to emit a specific amount of pollutants; these permits can be bought and sold, creating a market for pollution control.