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Eduardwww [97]
3 years ago
15

Suppose our firm produces chartered business flights with capital (planes) and labor (pilots) in fixed proportion (i.e. one pilo

t for each plane). If the wage rate paid to the pilots increases relative to the rental rate of capital for the airplanes, then? Please explain your answer.
A. Optimal capital labor ratio should increase.
B. Optimal capital labor ratio should decrease.
C. optimal capital labor ratio remains the same
D. Not enough information to answer question
Business
1 answer:
qaws [65]3 years ago
5 0

Answer:

C. optimal capital labor ratio remains the same

Explanation:

One pilot for each plane implies A = B

Let cost be C

So, isocost line is xA + rB = C

So, xA + yA = C (as L = K)

So, (x+y)A = C

So, A = C/(x+y) =B

Optimal capital labor ratio = B/A = 1 as B =A

Now, wage rate increases to x'

So, isocost line is x'A + yB = C

So, x'A + yA = C (as A = B)

So, (x'+y)A = C

So, A = C/(x'+y) = B

New optimal capital labor ratio =B/A = 1 as B = A

Thus, optimal capital labor ratio remains same because capital (planes) and labor (pilots) are used in fixed proportion.

Thus the answer is

C. optimal capital labor ratio remains the same

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Depreciation is a process by which A. the cost of plant and equipment is allocated to expense over the time periods which benefi
zysi [14]

Answer:

B. the decline in market value of plant and equipment is determined and recorded

  • <u>Depretiation is a measure of how much value our plant and equipement does loose because of use and the pass of the  time. </u>
  • If depretiation would not exist, we would register the value of plant and equipment as if they worth the same they did when they were bought, wich would be not real.
  • As an example, think about an oven in a bakery after using for some years: it is not in the same conditions that it was when new. This lost in the value of the goods (because of usage in this case), is what depretiations tries to account.

4 0
3 years ago
Suppose the total market value of all final goods and services produced this year in economy X is $4 million. Of the $4 million
kirill115 [55]

Answer:

A) $4 million

Explanation:

The GDP is woth $4 million because GDP equals the sum of all produced goods and services, in a given year, within a country.

Inventories are part of GDP, counted as private investment, even if they are not sold. The reason for this is that firms payed someone for the inventory with the aim of earning a profit in the future, and assets that are purchased with the goal of getting economic benefit from their use, are qualified as investments.

4 0
3 years ago
Wilturner Company incurs $83,000 of labor related directly to the product in the Assembly Department, $32,000 of labor related t
Alinara [238K]

Answer:

Work in process inventory ($83,000 + $32,000) $115,000

Factory overhead $19,000

            To wages payable  $134,000

(Being the labor is recorded)

Explanation:

The journal entry is shown below:

Work in process inventory ($83,000 + $32,000) $115,000

Factory overhead $19,000

            To wages payable  $134,000

(Being the labor is recorded)

For recording this we debited the work in process inventory and factory overhead and credited the wages payable so that the correct posting could be done

3 0
3 years ago
Chuong Ngo borrows $2700 from a bank that advertises a 7% simple interest rate and repays the loan in three equal monthly paymen
garik1379 [7]

The estimated Annual Percentage Rate is 10.5%

APR means Annual Percentage Rate.

Annual Percentage Rate refers to the interest rate one pays on a loan each year.

We will use the Annual Percentage Rate(APR) Formula to derive the estimate

APR = 2nr/(n+1) where the P = $2,700, R = 7% and N = 3

APR = 2*3*0.07 / (3+1)\\APR = 0.42 / 4\\APR = 0.105\\APR = 10.5%

In conclusion, the estimated Annual Percentage Rate is 10.5%

Learn more about Annual Percentage Rate here <em>brainly.com/question/9301830</em>

8 0
3 years ago
The ledger of Clayton Company includes the following unadjusted balances: Prepaid Insurance $3,000, Service Revenue $58,000, and
Licemer1 [7]

Explanation:

The adjusting entries are as follows

a.  Insurance expense A/c Dr $1,200

             To Prepaid insurance A/c $1,200

(Being the insurance expense is recorded)

The computation is shown below:

= $3,000 - $1,800

= $1,200

b. Account receivable Dr $1,100

       To Service revenue $1,100

(Being the service performed is recorded)

c. Salaries and wages expenses Dr $800

              To Salaries and wages payable $800

(Being the salaries and wages expense is recorded)

7 0
3 years ago
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