According to the Marginal Productivity Theory of Income

question 44

Multiple Choice

According to the marginal productivity theory of income,

• A)the greater the quantity of resources owned by an individual, the greater his incentive to increase productivity and his income.
• B)the average income received by an individual who supplies resources is influenced by the resources owner's marginal productivity.
• C)the income received by an individual who supplies labour services equals the incremental benefit generated to the firm by that individual's labour.
• D)the income received by an individual who supplies labour services equals the profit generated to the firm by that individual's labour.

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Definitions:

Budgeted Sales

The projected amount of sales revenue a company expects to achieve during a specific period, often part of financial planning.

Budgeted Raw Material Purchases

The estimated amount a company plans to spend on raw materials for production over a specific period.

Estimated Direct Labor Cost

The projected cost of labor directly involved in the manufacturing of goods or provision of services, excluding indirect labor costs.

Expected Cash Collections

Projected amounts of money a business anticipates receiving from its customers or clients over a specific period.