The essential rule that makers utilize to figure out what blend of work and capital conveys yield at the least expense is cost minimization. Cost minimization is the primary guiding principle that producers use to determine which combination of labor and capital produces the most output at the lowest cost.
a) Because the total cost less the variable cost, the fixed cost is $300.
At a result of nothing, the main expenses are fixed expenses.
B) The change in total cost for each additional output unit is equal to marginal cost. Additionally, it is equivalent to the variation in variable cost for each additional output unit. As the quantity changes, the fixed cost does not change, so total cost equals the sum of variable cost and fixed cost. As a result, the increase in variable cost is proportional to the increase in total cost as quantity increases.
<h3>What is the formula for reducing costs?</h3>
The marginal product of capital is equal to the marginal product of labor divided by the rental price of capital in the cost minimization formula.
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<span>A nominal interest rate means very low interest rates therefore we can use money for long duration by paying very low interest rate. We can hold this money for land duration. We also invest this money in other investment plan that gives better returns. This nominal interest rate is very helpful for running any business.</span>
Answer:
12.09%.
Explanation:
Calculation to determine the rate of return on the fund
First step is to calculate the beginning year NAV
Beginning year NAV = ($400 million assets - 50 million debt) / 15 million shares
Beginning year NAV = 23.33
Second step is to calculate the ending year NAV
Ending year NAV = ($500 million assets - (500*0.75% expense) - 40 million debt] / 18 million shares
Ending year NAV =[456.25/18 million shares]
Ending year NAV =25.35
Now let calculate the return using this formula
Return = (Ending NAV -beginning NAV + Capital gain + income) / Beginning NAV)
Let plug in the formula
Return = (25.35-23.33+0.30+0.50)/23.33
Return = 12.09%
Therefore the rate of return on the fund is 12.09%
Answer:
$30,000
Explanation:
Lara Technologies could invest the 250,000 in exchange of a 12% return, therefore, the opportunity cost would be:
$250,000 x 12% = $30,000
$30,000 dollars in returns is what Lara Technologies would give up if it purchased the land instead of investing the money.
Answer:
$36,000
Explanation:
The first step is to calculate the equivalent unit of work in process
=degree of completion × ending work in process
= 40/100 × 3000
= 0.4 × 3000
= 1,200
The total equivalent units of production can be calculated as follows
= 21,000 + 1,200
= 22,000 units
The cost per equivalent unit can be calculated as follows
= 660,000/22,000
= $30
Therefore the cost of ending work in process can be calculated as follows
= equivalent unit × cost per equivalent unit
= 1,200 × 30
= $36,000
