Answer:
b. Less is produced
Explanation:
The Principle of diminishing returns to capital states that as more unit of capital is added, a point will be reached where a decline in the marginal product will be encountered.
This simply means that for every additional unit of capital invested in the business, a less than proportionate increase is seen, this simply means that there will be a decrease in marginal productivity.
Answer:
Conversion cost per unit =11.25
Explanation:
The cost per equivalent unit =
Total conversion cost / Total number of equivalent units
Total number of equivalent unit = Degree of completion × units
= 40%× 800= 320 units.
Total conversion cost = Total value of work in process - cost of materials
= 6,000 - (800× 3)
= 3,600
Conversion cost per unit = 3,600/320=11.25
Conversion cost per unit =11.25
Answer:
A. Compute the multifactor productivity(MFP) (labor plus equipment) under the Prior to buying the new equipment.
multi-factor productivity = 90 carts / ($60 + $50) = 0.8182 carts/$
B. Compute the % growth in productivity between the Prior and after buying the new equipment.
new multi-factor productivity = 96 carts / ($50 + $60) = 0.8727 carts/$
% growth = (0.8727 - 0.8182) / 0.8182 = 6.66% increase
C. Comment on the changes in productivity according to two measures,and which you believe in the more pertinent for this situation?
the multi-factor productivity increased by 6.66% because even though the total cost of the factors of production remained the same, total output increased by 6 units
Answer:
Inelastic between the price of $6 and the price of $8
Explanation:
At price $8, the total expenditure ;
= price * Quantity
=$8 * 13600
=$108,800
At price $6, the total expenditure;
=$6 * 15200
=$91,200
Since the total expenditure is decreasing with a decrease in price then the elasticity of demand will be inelastic.
Answer:
c. The required rate of return would increase because the bond would then be more risky to a bondholder.
Explanation:
Options to the question are <em>"a. There is no reason to expect a change in the required rate of return. b. The required rate of return would decline because the bond would then be less risky to a bondholder. c. The required rate of return would increase because the bond would then be more risky to a bondholder. d. It is impossible to say without more information. e. Because of the call premium, the required rate of return would decline."</em>
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Bonds will be usually called back when the new interest rates are lower, this will lower the interest income of the investors. However, call premium cannot always compensate all the income loss by investors.