Acron Construction Charges Each Customer a Price Equal to the Cost

question 42

Multiple Choice

Acron Construction charges each customer a price equal to the cost of direct materials and direct labour plus 40%. Job 126 included the following costs: Direct materials $60,000
Direct labour $46,000
What price does the company charge for Job 126?

• A) $46,800
• B) $65,400
• C) $86,000
• D) $148,400

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Definitions:

Socially Efficient

An allocation of resources that results in the maximum possible economic benefit for society.

Marginal Revenue

The extra revenue generated from the sale of an additional unit of a product or service.

Deadweight Loss

The reduction in total surplus that results from a market distortion, such as a tax, subsidy, or price control.

Society's Welfare

A measure of the overall well-being and quality of life of the members of a society, often considered in economic terms but also including factors like health, education, and environmental quality.