Question

Both Saturn Technologies and Granite Inc. incur a cost of $200 to manufacture a single unit of a cell phone. However, Saturn Technologies charges a higher price than Granite Inc. does, but it still sells a higher number of phones. What does this imply?
Multiple Choice
A) Saturn Technologies and Granite have achieved a competitive parity
B) Granite Inc. has a competitive advantage over Saturn Technologies.
C) Saturn Technologies creates more economic value than Granite Inc. does
D) Granite Inc. is not charging enough for its product.

Answer 1

Answer:

It implies that Saturn Technologies creates more economic value than Granite Inc. does

Explanation:

Economic value is a measure of the benefit provided by a good or service to an economic agent. It is generally measured relative units of currency, and the interpretation is therefore: what is the maximum amount of money a specific actor is willing and able to pay for the good or service?