If a Firm Is a Perfectly Competitive Purchaser of Factor

question 194

Multiple Choice

If a firm is a perfectly competitive purchaser of factor inputs and the wage rate is $5, the marginal factor cost for labor is

• A) greater than $5.
• B) less than $5.
• C) $5.
• D) indeterminate.

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Definitions:

Days' Cash

A measure of a company's financial flexibility, indicating the number of days the company can continue to operate using only its cash on hand, without additional income or financing.

Petty Cash

Petty cash is a small amount of cash on hand used for paying expenses too small to merit writing a check or using a credit card.

Miscellaneous Expense

Expenses that are not classified under any standard expense categories within the accounting system, often of a small or irregular nature.

Days' Cash

A measure of a company's financial stability, indicating how many days the company can continue to operate using only its available cash without needing additional income.