Situation 26-2 A Company Is Trying to Decide Whether It Should Produce

Multiple Choice

Situation 26-2
A company is trying to decide whether it should produce good Y in the U.S. or in Mexico. Suppose a U.S. worker earns $12 per hour and a worker in Mexico earns $4 per hour. Also suppose that the marginal physical product (MPP) of the U.S. worker is 10 units of good Y and the MPP of the Mexican worker is 5 units of good Y.
-Refer to Situation 26-2. The output produced per $1 of cost in the U.S. is

A) 120 units of good Y.
B) 0.83 units of good Y.
C) 22 units of good Y.
D) 2 units of good Y.