The following table illustrates alternative production techniques for producing 18 widgets that can be sold for $1 each for a total revenue of $18. Refer to the above table. If the price per unit of labor were to increase from $2 to $3, the most efficient production technique would then be:
A) A
B) B
C) C
D) D

Question

The following table illustrates alternative production techniques for producing 18 widgets that can be sold for $1 each for a total revenue of $18.  Refer to the above table. If the price per unit of labor were to increase from $2 to $3, the most efficient production technique would then be:
A) A 
B) B 
C) C 
D) D

Quizplus · Accepted Answer

When the price per unit of labor increases from $2 to $3, the cost of production increases for all the techniques. However, technique C has the lowest total cost of production with $16.5, which is still less than the revenue of $18 for producing 18 widgets. Therefore, technique C remains the most efficient choice even with the increased price of labor.

The Following Table Illustrates Alternative Production Techniques for Producing 18