Suppose a firm is considering to buy a machine today at $25,000. The use of this machine in the production process of a commodity causes firm`s net incomes to rise by $ 15,000 in each of the next two years. Assume the rate of interest is 10% and machine has no scrap value. Is it desirable for the firm to purchase the machine? Explain your answer.
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- Imagine you are running a business that processes horticultural product, and is currently producing 40,000 tonnes of product per year. The average cost of producing 40,000 tonnes is $600 per tonne. A buyer for a large supermarket chain comes along and offers to buy an extra 10,000 tonnes of your product at a price of $300 per tonne. This price is much less than the average cost of production for the current annual output. With the current production system of the business, the marginal cost per tonne of producing an extra tonne is $200/ton. 1. Would you accept or reject this offer, and why? 2. What principles underlie your reasoning in deciding whether to accept or reject this offer?A delivery company is considering adding another vehicle to its delivery fleet; each vehicle is rented for $300 per day. Assume that the additional vehicle would be capable of delivering 1,750 packages per day and that each package that is delivered brings in $0.30 in revenue. Also assume that adding the delivery vehicle would not affect any other costs. Instructions: Enter your answers rounded to 2 decimal places. a. What is the MRP? What is the MRC? MRP = $ MRC = $ %3D Should the firm add this delivery vehicle: Yes b. Now suppose that the cost of renting a vehicle doubles to $600 per day. What are the MRP and MRC? MRP = $ MRC = Should the firm add a delivery vehicle under these circumstances: No c. Next suppose that the cost of renting a vehicle falls back down to $300 per day but, due to extremely congested freeways, an additional vehicle would only be able to deliver 750 packages per day. What are the MRP and MRC in this situation? MRP = $ MRC = $A delivery company is considering adding another vehicle to its delivery fleet; each vehicle is rented for $350 per day. Assume that the additional vehicle would be capable of delivering 1,750 packages per day and that each package that is delivered brings in $0.35 in revenue. Also assume that adding the delivery vehicle would not affect any other costs. Instructions: Enter your answers rounded to 2 decimal places. a. What is the MRP? What is the MRC? MRP = $ %3| MRC = $ Should the firm add this delivery vehicle: (Click to select) v b. Now suppose that the cost of renting a vehicle doubles to $700 per day. What are the MRP and MRC? MRP = $ MRC = $ Should the firm add a delivery vehicle under these circumstances: (Click to select) v c. Next suppose that the cost of renting a vehicle falls back down to $350 per day but, due to extremely congested freeways, an additional vehicle would only be able to deliver 750 packages per day. What are the MRP and MRC in this situation? MRP = $ MRC = $
- Suppose you manage a business that produces high-end dog food. The business produces 3,000 dog food cans per day, and can sell each can at $2.00/can regardless of how much is produced. Your firm currently employs 20 workers, each of whom earns $15/hour and work 8 hours per day. Inputs, like the meat for the food and the metal for the can, cost $1.00/can. Your overhead expenses, including rent, property taxes, insurance, etc., which does not vary with the number of cans produced, equals $250 per day. a. (3) Calculate your company’s current daily profit. You’re considering whether to hire additional workers to produce additional cans. Each worker would be paid $15/hr. and material costs remain constant at $1.00/can. You estimate the 21st employee would produce an additional 200 cans per day, and the number of additional cans from each additional worker would be decreasing by 40 (a 22nd employee could produce an additional 160 cans per day, a 23rd employee could produce an additional…A delivery company is considering adding another vehicle to its delivery fleet; each vehicle is rented for $250 per day. Assume that the additional vehicle would be capable of delivering 1,500 packages per day and that each package that is delivered brings in $0.25 in revenue. Also assume that adding the delivery vehicle would not affect any other costs. Instructions: Enter your answers rounded to 2 decimal places. a. What is the MRP? What is the MRC? MRP = $ MRC = $ Should the firm add this delivery vehicle: (Click to select) ♥ b. Now suppose that the cost of renting a vehicle doubles to $500 per day. What are the MRP and MRC? MRP = $ MRC = $ Should the firm add a delivery vehicle under these circumstances: (Click to select) ♥ c. Next suppose that the cost of renting a vehicle falls back down to $250 per day but, due to extremely congested freeways, an additional vehicle would only be able to deliver 750 packages per day. What are the MRP and MRC in this situation? MRP = $ MRC = $…The yearly demand for a widget is 5000 units. The cost of ordering is $100 per order and the cost of holding is $4 per unit per year. The widget was ordered in batches of 1000 units and the firm changes the policy to order as per the economic order quantity. What is the saving in total inventory related costs because of the change in the ordering policy? (Inventory related costs include holding and ordering costs)
- Suppose a firm expects that a $40 million expenditure on R&D in the current year will result in a new product that can be sold next year. Selling that product next year will increase the firm's revenue next year by $60 million and its costs next year by $54 million. Instructions: Enter your answer as a whole number. a. What is the expected rate of return on this R&D expenditure? percentA manufacturing company leases a building for $100,000 per year for its manufacturing facilities. In addition, the machinery in this bullding is being pald for in Installments of $20,000 per year. Each unit of the product produced costs $15 in labor and $10 in materials. The product can be sold for $40. Using this information, answer the follwoing questions. 1. 8,000 2. $30,000 3. 4,800 How many units per year must be sold for the company to breakeven? 4. 5,019 If 10,000 units per year are sold, what is the annual profit? 5. 6,667 Sheridan 6. $50,000 7. $80,000 8. $100,000Suppose that the price of a barrel of oil is $80 and interest rates remain at 8%. If a new technology is implemented in one of the wells and it costs $3,000,000. Calculated the estimated "profit" from outfitting one of our wells with this new technology.
- A firm faces the following costs: total cost of capital = $8,000; price paid for labor = $20 per labor unit; and price paid for raw materials = $6 per raw-material unit. Initially, the firm can produce 2,000 units of output by combining its fixed capital with 250 units of labor and 400 units of raw materials. After the firm improves its production process, it can produce 5,000 units of output by combining its fixed capital with 150 units of labor and 300 units of raw materials. How will the firm's total costs change as a result of the improved production process? Instructions: Enter your answers as a whole number. Total cost changes from $ ___ using the original process to $ ___ using the improved process. plz answer correct asap dont answer by pen peparQuestion 3 Joan Zorba orders calculators for her office supply stores. Each calculator cost $35, currently she is ordering 230. Daily demand for these calculators is 5. The cost to re-order this item is estimated at $44, while the annual inventory holding cost is 22%. Orders are received two working days after an order is placed. The office operates 52 weeks per year, 5 days per week. What is the duration of a cycle (in days) associated with the EOQ? Greater than or equal to 6 and less than or equal to 10 Greater than or equal to 58 and less than or equal to 68 Greater than or equal to .001 and less than or equal to 3 Greater than or equal to 18 and less than or equal to 28 4 pts < Previous Next VIQUESTION 7 A firm's production function given by Q=2KL where K, L and Q denote capital, labor, and output, respectively. The firm wants to produce an output of 32 units at a minimum cost. The wages and rent are $2. Show the solution graphically and find the value of capital and labor that the firm will use at the solution (Using symmetry, you can easily do this). Attach File Browse Local Files Browse Content Collection
