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2 years ago

if the marginal product of capital is less than the rental rate of capital, the firm should rent more capital.

1 answer:

6 0

It is not correct to say that a company ought to rent more capital "if the marginal output of capital is smaller than the rental rate of capital." Hence we conclude that the statement is FALSE.

This is further explained below.

<h3>What is the marginal product?</h3>

Generally, In neoclassical economics, the marginal product is the change in output that occurs from utilizing one more unit of a particular input, assuming that the values of all other inputs remain constant. Marginal product is the difference in output that occurs when an extra unit of input is used.

In conclusion, if the MPK is greater than the rental rate of capital, then the only time a firm should employ more capital is when they need it.

This is the only time that a company should employ additional capital.

It is not correct to say that a company ought to rent more capital "if the marginal output of capital is smaller than the rental rate of capital."

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4 years ago

A global business is organized into four groups: Manufacturing, Research and Development, Finance, and Sales. This company uses

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Functional structure.

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3 years ago

The competitive equilibrium rent in the city of Lowell is currently $1,000 per month. The government decides to enact rent cont

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Answer:

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For someone who is currently renting an apartment, he or she should be better off with rent control as long as they keep renting the same apartment. They will pay a lower price.
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4 years ago

What difficulties did factory workers face?

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4 years ago

On January 1, a machine with a useful life of five years and a residual value of $80,000 was purchased for $240,000. What is the

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Answer:

$57,600

Explanation:

The computation of the depreciation expense under the Double-declining balance method is shown below:

First we have to find the depreciation rate which is shown below:

= 1 ÷ useful life

= 1 ÷ 5 years

= 20%

Now the rate is double So, 40%

In year 1, the original cost is $240,000, so the depreciation is $96,000 after applying the 40% depreciation rate

And, in year 2, the $144,000 × 40% = $57,600

The $144,000 is come from

= $240,000 - $96,000

= $144,000

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3 years ago