A Firm Has a Lerner Index of 0

question 92

Multiple Choice

A firm has a Lerner index of 0.75 and charges a price of $150.The firm's marginal cost is:

• A) $0.
• B) $37.50.
• C) $112.50.
• D) There is not sufficient information to determine the firm's marginal cost.

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Definitions:

Finished Goods Inventory

The stock of completed products that are ready for sale but have not been sold yet.

Raw Materials Inventory

The total cost of all the materials that are used in production but have not yet been transformed into finished goods, representing a current asset on the balance sheet.

Cost of Goods Sold

The direct costs attributable to the production of the goods sold by a company.

Merchandise Inventories

Goods and products that a company holds for the purpose of selling them to customers as part of its business operations.