Assume That Labor Is the Only Factor of Production and That

question 11

Multiple Choice

Assume that labor is the only factor of production and that wages in the United States equal $20 per hour while wages in Japan are $10 per hour. Production costs would be lower in the United States as compared to Japan if

• A) U.S. labor productivity equaled 40 units per hour and Japan's 15 units per hour.
• B) U.S. labor productivity equaled 30 units per hour and Japan's 20 units per hour.
• C) U.S. labor productivity equaled 20 units per hour and Japan's 30 units per hour.
• D) U.S. labor productivity equaled 15 units per hour and Japan's 25 units per hour.
• E) U.S. labor productivity equaled 15 units per hour and Japan's 40 units per hour.

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Definitions:

Stock Split

A corporate action where a company divides its existing stock into multiple shares to boost the liquidity of the shares, without changing the market capitalization.

Percent Of Ownership

The portion of a company or asset that an individual or entity owns, typically expressed as a percentage.

No-Par Stock

Shares issued without a specified face value, allowing companies flexibility in setting share prices and accounting for equity.

Stated Value

A value assigned to a company's shares that does not have a par value; often used in accounting for preferred stock.