Use the Following to Answer Questions :
Scenario: the Decision

question 117

Multiple Choice

Use the following to answer questions :
Scenario: The Decision to Hire Labour
Assume that both the product market and the labour market are perfectly competitive.The price of this firm's product is $5.The firm's total product with respect to labour is given in the table that follows. $\begin{array}{llcc} \hline \text { Quantity } & \\ \text { of Labour } & \text { Quantity } \\ \text { (workers) } & \text {of Output }\\\hline 0&0\\1 &7\\2 &13\\3&18\\4&21\\\hline\end{array}$

-(Scenario: The Decision to Hire Labour) Use Scenario: The Decision to Hire Labour.What is the value of the marginal product of the third worker to this firm?

• A) $5
• B) $25
• C) $18
• D) $10

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Definitions:

Job-Order Costing

An accounting methodology that assigns costs to specific production batches or jobs, useful for custom or unique products.

Unit Product Cost

The calculated cost of a single unit of product that includes direct materials, direct labor, and manufacturing overhead.

Predetermined Overhead Rate

A rate used to allocate manufacturing overhead costs to products or job orders, calculated before the period begins based on estimated costs and activity levels.

Machine-Hours

The total duration of operation for machinery within a specified timeframe, used in cost and efficiency analysis.