If the Maximum Number of Units of Cloth Produced Is

question 182

Multiple Choice

If the maximum number of units of cloth produced is 300 and the maximum number of units of corn produced is 600, then with an MPL_cloth = 2, what is the number of workers in the economy?

• A) 100
• B) 200
• C) 150
• D) 600

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Definitions:

Planning Budget

A financial plan that estimates the income and expenditures for a future period, often used as a guide for financial decision making.

Revenue

The income generated from normal business operations and includes discounts and deductions for returned merchandise.

Flexible Budget

A budget that adjusts or flexes with changes in the volume or activity level.

Static Planning Budget

A budget based on a fixed level of activity and does not change in response to variations in the actual level of activity.