Answer:
a. increase; decrease
Explanation:
The crowding-out effect is one where public spending intended to increase spending in the economy (ie. aggregate demand, and thus stimulate the economy) results in less private spending, causing aggregate demand to increase less than the increase in public spending.
The reason is because as government spend they have to use money. That will raise demand for money, causing the its price (interest rate) to increase. Because money becomes more valuable (people have to forgo higher interest rate to spend their money or pay higher rate to borrow) there will be less spending on consumption and investment. Higher interest rate also causes net exports to decrease (more imports less exports).
Which of the following are the four categories of resources?
a. human effort, human capital, money, and gold
b. labor, physical capital, money and the banking system
c. labor, entrepreneurial ability, capital, and money
d. labor, entrepreneurial ability, capital, and natural resources
Answer and Explanation:
d. labor, entrepreneurial ability, capital, and natural resources
Which of the following is correct?
A) In unionized industries, wages are below the level that would prevail in competitive markets.
B) The introduction of a union in an industry reduces the quantity of labor demanded in that industry, causes some workers in that industry to be unemployed, and reduces wages in the rest of the economy.
C) There is a strong consensus among economists that unions are bad for the U.S. economy.
D) All of the above are correct.
Answer: There is a strong consensus among economists that unions are bad for the U.S. economy.
Explanation: A union is a group formed by employees of an establishment or workers of the government whose duty is to fight for improved working conditions of its members.
A union can sometimes make unrealistic demands to their employers and also unions tend to shut down economic activities of their sector of operation, if their demands are not met. These factors makes unions partly an economical disadvantage.
Brenda owns a store in a small town. The store sells a small range of everyday and impulse products, such as chocolates, magazines, novelties, and snacks. The store remains open seven days a week from 08:00 a.m. to 12:30 a.m. Brenda's store can be categorized as a(n) _____.A. department storeB. convenience storeC. outlet storeD. specialty store
Answer:
B. convenience store
Explanation:
A convenience store is a retail store that sells a small range of everyday and impulse products.
A speciality store is a retail store that sells specific types of products. E.g. pharmacies
An outlet store is owned by a manufacturer of a product, the manufacturer sells only its product in this store.
A department store is a retail store that sells a large variety of consumer products.
Blossom Company issues 6500 shares of $10 par value common stock at $12 per share. When the transaction is recorded, credits are made to:Common Stock $65000 and Paid-in Capital in Excess of Stated Value $13000.Common Stock $78000.Common Stock $65000 and Paid-in Capital in Excess of Par Value $13000.Common Stock $65000 and Retained Earnings $13000.
Answer:
Common Stock $65000 and Paid-in Capital in Excess of Par Value $13000
Explanation:
When a company issues stock they have to record the transaction at the stock's par value or book value. In this case the par value was $10 per stock, so the total Common Stock account should increase by $65,000.
Any amount of money paid in excess of par value must be recorded in another account, the Paid-in Capital in Excess of Par Value account. The extra $13,000 should be recorded in this account.
Admire County Bank agrees to lend Givens Brick Company $600,000 on January 1st. Givens Brick Company signs a $600,000, 8%, 9-month note. What entry should be made by Givens Brick Company on January 1st to record the proceeds and issuance of the note?
Answer:
The journal entry for the issuance and the proceeds of the note is shown below:
Explanation:
Cash A/c.........................Dr $600,000
Notes Payable A/c......Cr $600,000
The givens company received a amount of $600,000 from the bank, so cash is increasing and increase in cash is debited. Therefore, the cash account is debited. Whereas, the cash against a note payable, which increases the liability and any increase in liability is credited. Therefore, notes payable is credited.
Two reasons why an economy might operate inside of its production possibilities frontier are
a. productive efficiency and technological change
b. depressions and inflation
c. recessions and productive inefficiency
d. opportunity costs and substitutability of resources used in production
Answer:
The correct answer is option c.
Explanation:
A production possibility frontier shows the maximum possible combinations of two goods that an economy can produce using all the available resources. The points below the production possibility frontier show inefficient bundles. The points on the curve show the efficient utilization of resources. The points above the curve show unattainable bundles.
An economy may operate below its production possibility curve because of recessions and inefficiency in production. During recessions or because of productive inefficiency all the available resources are not efficiently utilized.
What is the difference between a budget and a standard?
a) A budget is the cost of an item at a static activity level, while a standard is based on a flexible activity level.
b) A budget is a total amount, while a standard expresses only a unit amount.
c) A budget is the amount planned, while a standard reflects the actual results. d) There is no difference, they are the same.
Answer:
B
Explanation:
Standard is used for unit projection and unit prices of a product, while Budget is used for total projection in both price and Total units of a product.
A budget is a total amount used for planning and control, while a standard is a unit amount used for performance evaluation and improvement.
Explanation:A budget and a standard are two different concepts in management accounting.
A budget represents the financial plan for a particular period of time, usually expressed in monetary terms. It outlines the expected income and expenses for the organization. It is a total amount and can be used for planning, control, and performance evaluation.
On the other hand, a standard represents a predetermined level of performance or cost that should be achieved. It is usually expressed per unit of output. For example, a standard could be the expected cost per unit of production or the expected time to complete a task. Standards are used to measure actual performance against the expected level and identify areas of improvement.
In summary, the difference between a budget and a standard is that a budget is a total amount used for planning and control, while a standard is a unit amount used for performance evaluation and improvement.
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Refer to Pure Training, Inc. If clients (the business owners) were asking for workshops to allow their customers to listen to audio files about their product or service, Pure Training would be organizing ____ workshops.A. blogB. podcastC. social content siteD. social gameE. forum
Answer: Podcast
Explanation: In simple words, podcast refers to a digital audio file that is uploaded on the internet and can be easily downloaded through a computer or mobile device.
A podcast is used for many purposes like for reading of novels or for educational seminars etc. Sometimes companies also use podcast for advertisements or promotional purposes when the target audience is low in volume and mass media mediums are of no use.
Hence from the above we can conclude that the correct option is B.
Pure Training, Inc. would organize podcast workshops for clients who want their customers to listen to audio files discussing their products or services. Podcasts, being a form of digital media which includes audio files on topics of interest, are the best way to address this request.
Explanation:If clients were asking for workshops that allow their customers to listen to audio files about their products or services, Pure Training, Inc. would be organizing podcast workshops. A podcast workshop would best suit this request because podcasts are a form of digital media in which audio files that you can listen to are included. These files can be conveniently downloaded or streamed to learn about a particular topic, in this case, a business's product or service. Hence, customers can gain more in-depth knowledge about the products or services at their own time and pace through the podcast workshops.
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When economists determine that a nation’s gdp has declined
Answer:
The correct answer is economic shrinkage.
Explanation:
An economic contraction is a general reduction of goods and services in a market. It is typically related to a recess in production caused by external factors, such as weather conditions, or by internal factors, such as taxes, high regulation and other impacts on producers' incentives.
Both the contraction and economic expansion have to do with the cycles of global production of goods in an economy, while inflation and deflation refer to the exchange rate appreciation cycle.
In the context of the most common sales presentation types, which of the following statements is true about the standard memorized presentation?
a. Its effectiveness is limited because it offers no opportunity for the salesperson to tailor the presentation to the needs of a specific customer
b. It fails to help bring new salespeople up to speed quickly or to give them confidence. Its applicability is an advantage because it lets a salesperson demonstrate empathy, which is an important step in developing a partnering relationship
c. It is more informal and natural than the customized presentation. It provides more opportunity for a customer to participate in the sales interaction than does an outlined presentation
Answer:
A) Its effectiveness is limited because it offers no opportunity for the salesperson to tailor the presentation to the needs of a specific customer
Explanation:
An standard memorized presentation is a sales presentation that is repeated over and over again to different clients. Actually it should include the best highlights and key selling points, but none the less, it is basically the same presentation every time. Depending on what you are selling and if you are a new salesperson, this might be effective, for example for selling pharmaceutical products, since you are always selling to the same audience, doctors.
But I sincerely doubt that this technique is effective most of the time or at last for most products. People have a tendency to be curious, so generally your clients will ask you things about your products and also your clients are not always the same. Imagine if you are trying to sell clothes, cars or furniture, etc., your sales pitch should not be same for all your clients.
To make low-profit customers more profitable the ABC bike shop-
A) sends birthday greetings to its best customers and gives them discounts on merchandise.
B) has a club for its regular customers, organizing cycling events and parties for them.
C) allows existing customers to upgrade to a newer model by trading in their older model.
D) though it previously offered free delivery, now charges for deliveries made outside the city.
E) encourages customers to send in their suggestions for product improvement.
Answer:
C) allows existing customers to upgrade to a newer model by trading in their older model.
D) though it previously offered free delivery, now charges for deliveries made outside the city.
Explanation:
If ABC company wants to change low profit customers into more profitable customers, they need to:
encourage low profit clients to buy larger quantities by offering promotions (e.g. get a discount if you buy a bike, helmet and other gear all together)forgo certain services or features to low profit customers, e.g. free delivery only for expensive bikesincrease the price of your product for low profit customers (e.g. charge a delivery cost for cheap bikes)offer upgrading options to low profit clients
This name is given to the system of land ownership during the early years of the industrial revolution in which british landowners divided their fields into smaller units and charged rent to farmers or business owners.
Answer:
The system of land ownership during the early years of the industrial revolution where british landowners divided their fields into smaller units is known as Enclosure
Explanation:
Enclosure occured in England during the early years of the industrial revolution and played a part in migration of people from rural areas to cities that were becoming industrialized.
In the Enclosure system, common lands were merged, and the masses who previously had access to such lands, for activities such as grazing and farming, became restricted. Only the land owners could access such enclosed lands.
Land owners could then divide their lands into smaller portions and charge rent for it.
If the Central Bank of Macroland puts an additional 1,000 dollars of currency into the economy, the public deposits all currency into the banking system and banks have a desired reserve/deposit ratio of 0.20, then the banks will eventually make new loans totaling ______ and the money supply will increase by _______.
Answer:
$4,000$5,000Explanation:
First we have to determine the money multiplier of Macroland:
money multiplier = 1 / 0.2 = 5If $1,000 are deposited in banks and the banks have a 20% reserve ration, they will be able to lend $800. The $800 will then increase to $4,000 (= $800 x 5) because of the money multiplier.
The total increase in the money supply is given by the $1,000 deposited originally and the $4,000 in increased loans = $5,000
Final answer:
If the Central Bank of Macroland puts an additional 1,000 dollars of currency into the economy, the public deposits all currency into the banking system and banks have a desired reserve/deposit ratio of 0.20, then the banks will eventually make new loans totaling 4,000 dollars and the money supply will increase by 5,000 dollars.
Explanation:
When the Central Bank of Macroland injects an additional 1,000 dollars into the economy with a reserve/deposit ratio of 0.20, banks can eventually make new loans totaling 4,000 dollars, increasing the money supply by a total of 5,000 dollars.
The key to understanding this question is the concept of the money multiplier effect in the banking system. When banks receive deposits, they keep a portion as reserves to satisfy withdrawal demands and lend out the remainder. The reserve ratio dictates how much must be kept in reserve compared to the total deposits. In this case, a 20% reserve deposit ratio (0.20) is mentioned.
This ratio implies that for every dollar deposited, 20 cents must be kept as a reserve, and the remaining 80 cents can be lent out.
The money multiplier formula in this context is 1/reserve requirement ratio, which in this scenario is 1/0.20 = 5. This means that for every dollar of reserves, the banking system can expand the money supply by up to 5 dollars.
Given the Central Bank injects 1,000 dollars and considering the money multiplier of 5, the total increase in the money supply can reach 5,000 dollars (1,000 dollars × money multiplier of 5). Subtracting the original 1,000 dollars injected, the banks will have made new loans totaling 4,000 dollars.
The level of liquid assets that should be invested in marketable securities depends on several factors. This includes all except which of the following?
a. The variability of the firm's cash flows
b. Transaction costs involved in buying and selling the securities
c. Seasonal cash requirements d. Interest to be earned over the expected holding period
Answer:
c.
Explanation:
Based on the information provided within the question it can be said that the exception of the answers provided are seasonal cash requirements. This refers to the amount of cash you or the company needs to pay for unique expenses during a specific season. Which is not a factor when deciding what should be invested in marketable securities.
Soar Incorporated is considering eliminating its mountain bike division, which reported an operating loss for the recent year of $3,300. The division sales for the year were $1,053,000 and the variable costs were $863,000. The fixed costs of the division were $196,000. If the mountain bike division is dropped, 30% of the fixed costs allocated to that division could be eliminated. The impact on operating income for eliminating this business segment would be:
(A) $190,000 decrease
(B) $190,000 increase
(C) $58,800 decrease
(D) $55,500 decrease
(E) $131,200 decrease
Answer:
$133,900 decrease
Explanation:
Since the mountain bike division's total fixed costs are $196,000, and only 30% can be eliminated, then the rest of the company will absorb $137,200 in fixed costs.
Since the division has an operating loss of $3,300, then that would be saved.
Total impact on income = - $137,200 + $3,300 = -$133,900
*I believe one amount is wrong, the operating loss was $6,000, not $3,300 (= $1,053,000 - $863,000 - $196,000 = -$6,000). If we calculate the impact with an operating loss of $6,000, then the net effect would be a $131,200 decrease (option E)
Keon, vice-president of human resources for a large manufacturing firm, wants to keep the reward system membership-based instead of moving to performance-based pay. Traditionally, most increases have been based on seniority. Why does he want to keep the membership-based system?
Answer:
The correct answer is The criteria area easier to measure with the membership-based system.
Explanation:
Obviously by changing, for example, the money for memberships, companies save in some way the expense that would be to measure the performance of employees one by one. If the organization is measured globally, or perhaps by areas, there will be an overview of the fulfillment or not of the proposed objectives.
A membership system allows employees to be recognized in the same way, without individualism prevailing, leading to better rapport and teamwork.
Transporting and storing goods, breaking bulk, providing credit, local advertising, sales representation, and negotiations with middlemen most directly relate to which of the six Cs of the channel distribution strategy?
Answer:
The C which is relevant for this strategy from the 6 Cs is the Cost.
Explanation:
The channel distribution is the path which a product or service takes in order to reach the consumer. It allows the direct channel so that consumers buy directly from the manufacturer.
The channel distribution strategy is the Cost which is stated as the cost of the product. So, the storing goods, providing credit, sales representation and transporting related to the Cost.
The correct answer is: c) coverage. Transporting and storing goods, breaking bulk, providing credit, local advertising, sales representation, and negotiations with middlemen most directly relate to coverage.
Coverage refers to the breadth and intensity of distribution achieved through a channel. It focuses on how well the product or service reaches the target market.
The activities listed all directly impact how widely and effectively a product reaches its target audience:
Transporting and storing goods: Ensures physical availability in different locations.
Breaking bulk: Allows for smaller quantities to reach various retailers.
Providing credit: Enables wider customer reach by offering financing options.
Local advertising: Directly targets customers in specific regions.
Sales representation: Represents the product to potential buyers.
Negotiations with middlemen: Secures partnerships with distributors to expand reach.
While other Cs of the channel strategy are also relevant:
Cost: Refers to the economic efficiency of the channel.
Control: The level of influence a company has over the channel members.
Character: The image the channel portrays of the product or service.
Continuity: Maintaining consistent availability and service throughout the channel.
Coverage most directly encompasses the activities listed because it focuses on ensuring the product reaches the target market through various means.
The complete question is- Transporting and storing goods, breaking bulk, providing credit, local advertising, sales representation, and negotiations with middlemen most directly relate to which of the six Cs of the channel distribution strategy?
a) cost
b) control
c) coverage
d) character
e) continuity
On July 1, 2018, Mason & Beech Services issued $48,000 of 9% bonds that mature in five years. They were issued at par. The bonds pay semiannual interest payments on June 30 and December 31 of each year. On December 31, 2018, what is the total amount paid to bondholders?
Answer:
December 31th, 2018 the bondholder will receive $ 2,160
Explanation:
The bondholders will get the face value times the bond rate:
In this case:
$ 48,000 principal
9% = 9/100 = 0.09 annual rate = 0.09/2 = 0.045 coupon rate
We divide by 2 as there is two payment per year thus, the principal capitalize for 6 month over a total of 12 between payments.
bonholders payment:
principal x semiannual rate:
$ 48,000 x 0.045 = $ 2,160
The advertising campaign for Crest toothpaste lets consumers know about its newest flavor, and also mentions its history as an established brand. The ad also mentions Crest’s advantages and benefits. Crest’s advertising would be classified as
Answer: Product Advertisements
Explanation: Product Advertisement is the advertisement of a product using its brand name, features and all its benefits when advertising such products.
Product advertisement focuses on the particular product being advertised. The products features, benefit and brand name are all featured in the advert.
This is to create an awareness for the product being advertised.
According to John Maynard Keynes:
a. the economy would automatically adjust to full employment in the long run.
b. aggregate expenditures (demand) can be forever inadequate to achieve full employment.
c. neither aggregate demand nor aggregate supply is a determinant of full-employment real GDP.
d. aggregate output (supply) can be forever inadequate to achieve full employment.
Answer:
b. aggregate expenditures (demand) can be forever inadequate to achieve full employment.
Explanation:
According to John Maynard Keynes aggregate expenditures (demand) can be forever inadequate to achieve full employment.
In order for information to be meaningful, a firm's accounting processes and procedures should be certified as accurate by acceptable accounting standards. Companies hire ________ to provide unbiased opinions about the accuracy of a firm's financial statements.a) bookkeepersb) private accountantsc) tax accountantsd) independent auditors
Answer: Independent Auditors
Explanation: Independent Auditors are professionals in the field of accounting such as chattered accountants that are employed to check the business and financial records of an organization to which they don't work in. Auditors are used to ensure accuracy in records and also to ensure no financial mismanagement or fraud.
In the leadership of both parties in Congress, certain members are responsible for legislative strategy, building support and coalitions for key issues, and informal vote counting. What is this role called?
Answer:
The correct answer is Whip.
Explanation:
The whip is an officer in a political party whose main purpose is to ensure party discipline in a legislature. Whips are "executors" of a party, which typically offer incentives and threaten party members to ensure they vote according to official party policy. Role of a whip is also to ensure that the elected representatives of your party are present when important votes are taken. The use comes from the term hunting "whipping," that is, prevention of hounds from wandering away from the pack.
Western Company recently lost its entire inventory in an earthquake. The following information is available from its accounting records: Beginning inventory: $5,000; purchases: $18,000; net sales: $40,000. The company's average gross profit percentage is 40%. Using the gross profit method, a reasonable estimate of cost of goods sold for this past period would be:______
Answer:
$24,000
Explanation:
Cost of goods sold = Net sales - gross profit.
As net sales = $40,000
Average gross profit = 40%
Thus, gross profit in dollars = $40,000 [tex]\times[/tex] 40% = $16,000
Thus, cost of goods sold = $40,000 - $16,000 = $24,000
Sales represent the total revenue earned and cost represent the entire value of manufacturing it.
It is $24,000.
As governor, Marcy has decided that anyone who works but earns less than $20,000 a year will have their health insurance premiums paid for by the government.
How does this affect the equilibrium price and quantity of medical services?
a. Diminishing returnsb. Moral Hazardc. Market Failured. Adverse Selectione. Principle-agent problem
Answer:
They have risen.
Explanation:
Demand has increased, but supply has remained constant.
The distinction between _____ is what defines an MNE from a firm that merely exports or imports.a. small- and large-scale of entryb. licensing and franchisingc. direct and indirect exportsd. equity and non-equity modes of entry
Answer: Option a
Explanation: MNE refers to multinational enterprises, these organization are the one which operates their their business in several countries. Due to their world wide reach to the markets their scale of operations remains very high with a large number of shareholders.
These organisation usually have more than one form of business, they diversify their activities as a protection from different political or environmental factors in the countries in which they operate.
Hence the correct option is A.
Final answer:
The key difference between a Multinational Enterprise (MNE) and a firm that just imports or exports lies in the equity and non-equity modes of entry, with MNEs typically engaging in direct investments to enter foreign markets.
Explanation:
The distinction between equity and non-equity modes of entry is what defines a Multinational Enterprise (MNE) from a firm that merely exports or imports. When we talk about equity modes, we're referring to direct investments into foreign operations, such as joint ventures or wholly-owned subsidiaries. Non-equity modes include licensing, franchising, and management contracts, which do not require direct investment but still allow firms to have a presence in foreign markets.
Barriers to entry are critical in determining the number of firms in an industry and impact how these firms conduct businesses internationally. Economies of scale, government-enforced barriers, and natural monopolies can influence the market dynamic, leading to a differentiation between larger, influential firms and smaller players.
For instance, high capital requirements or technological complexities can make markets less competitive and tend towards monopoly, where the dominant firm might exhibit market power. In competitive markets, the entry and exit process is determined by both intentional and natural barriers, which can also influence a firm's decision to engage in foreign markets.
Lisa and Elizabeth are both calculating asset values to determine if any previously impaired assets are further impaired. Instead of additional asset impairment, they found that they each had an asset that had increased in value. Lisa recorded this increase in value, but Elizabeth did not. Why?
Answer:
The correct answer is Lisa's asset is being held for disposal, and Elizabeth's asset is currently in use.
Explanation:
The assets should be recognized in the balance sheet when it is probable that they will obtain benefits or economic returns for the company in the future, and provided that they can be valued reliably. The accounting recognition of an asset also implies the simultaneous recognition of a liability, the decrease of another asset or the recognition of an income or other increases in equity. depending on the accounting context.
An asset is recognized in the balance sheet when it is probable that future economic benefits will be obtained for the company, and in addition the asset has a cost or value that can be measured reliably ”,“ an asset is not recognized in the balance sheet when it is considered unlikely that, from the corresponding disbursement, economic benefits will be obtained in the future. Instead, such a transaction leads to the recognition of an expense in the income statement
Bruce is a single father with 1 child. He can work as a bagger at the local grocery store for $6 per hour up to 1,200 hours per year. He is eligible for welfare, and if he does not earn any income, he will receive $15,000 a year. If Bruce works, the government policy is to deduct 60 cents from his welfare stipend for every $1 that he earns in income. With this policy in place, if Bruce works 600 hours, his income will be_________.
Answer:
$16,440
Explanation:
If Bruce is able to work 600 hours per year, his salary will be $3,600 (= $6 x 600), but he will lose $2,160 (= $3,600 x 60%) of welfare stipend.
His total welfare stipend is $15,000 if he is not able to work during the year.
Bruce's total income = $15,000 + $3,600 - $2,160 = $16,440
New oak tables are normal goods. What would happen to the equilibrium price and quantity in the market for oak tables if the price of maple tables rises, the price of oak wood rises, more buyers enter the market for oak tables and the price of wood saws increased?
Answer:
The equilibrium price will increase and change in equilibrium quantity will be unambiguous.
Explanation:
If the price of maple tables rise, the consumers will prefer the cheaper substitute. So the demand for oak tables will increase. At the same time, the entry of new buyers in the market for Oaktables will also increase the demand.
This increase in demand for oak tables will cause the demand curve to move to the right.
An increase in the price of oak woods and wood saws will increase the input cost for oak table producers. So their cost of production will increase. This will cause the supply of oak tables to decrease.
This decrease in supply will cause the supply curve to shift to the left.
This leftward shift in the supply curve and a rightward shift in the demand curve will cause the equilibrium price to increase.
The change in the equilibrium quantity will depend upon the proportionate change in demand and supply. If both changes by the same proportion the equilibrium quantity will remain the same.
If demand increases more than the decrease in supply, the quantity will increase. IF supply decreases more than the increase in demand, the equilibrium quantity will decrease.
Which of the following statements is a positive statement? Which is a normative statement?
a. The federal minimum wage is increasing to $6.50 an hour.
b. The minimum wage should be high enough that families will not live in poverty.
Answer:
A positive statement seeks to describe or explain something based on empirical evidence, while a normative statement seeks to recommend something, or to express a subjective opinion.
a. The federal minimum wage is increasing to $6.50 an hour. - Positive statement. It is stating a fact, not telling us whether this rise in the minimum wage is good or bad.
b. The minimum wage should be high enough that families will not live in poverty. - This is a classical normative statement. It is giving an opinion, and recommending a policy.
A positive statement describes facts or the way things are, while a normative statement expresses an opinion or value judgment.
Explanation:A positive statement is a statement that describes facts or the way things are. It can be tested and proven true or false. An example of a positive statement A: The federal minimum wage is increasing to $6.50 an hour.
A normative statement, on the other hand, is a statement that expresses an opinion or makes a value judgment. It cannot be tested or proven true or false. An example of a normative statement is: The minimum wage should be high enough that families will not live in poverty.
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Liyun owns a small flower shop, and the industry is perfectly competitive. She is considering whether to hire an additional worker. The wage rate for the worker is $500 per week; the marginal product of the additional worker would be 100 units per week; and the price of the units is $10 each. Liyun should: Select one: a. raise the price of the flower arrangements that she sells. b. not hire the additional worker. c. hire the additional worker. d. Not enough information is given to answer the question
Answer:
C) hire the additional worker.
Explanation:
The marginal revenue generated by the additional employee is $1,000 (= 100 units x $10 per unit), while the marginal cost of hiring the additional employee is only $500. Since the marginal revenue is greater than the marginal cost ($1,000 > $500), then Liyun should hire the additional employee.