Tondre Inc

question 23

Multiple Choice

Tondre Inc. has provided the following data for the month of July: The cost of goods manufactured for July is:

• A)$210,000
• B)$205,000
• C)$208,000
• D)$207,000

---

Definitions:

Law of Diminishing Returns

The principle that adding more of one factor of production, while keeping others constant, will eventually yield lower per-unit returns.

Economic Profit

The surplus remaining after deducting both explicit and implicit costs from total revenues, emphasizing a firm's financial performance beyond just its accounting profit.

Accounting Profit

Accounting profit is the monetary gain calculated by subtracting total explicit costs from total revenue.

Sunk Cost

A cost that has already been incurred and cannot be recovered, and therefore should not affect current and future business decisions.