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Anna35 [415]
3 years ago
13

A wheat farmer sells wheat in a perfectly competitive market and hires labor in a perfectly competitive market. The market price

of wheat is $2 a bushel, the wage rate is $10, the farmer employs five workers and the marginal product of the fifth worker is 3 bushels. What would you advise this farmer to do?
Business
1 answer:
const2013 [10]3 years ago
7 0

Answer:

Reduce the labor employed.

Explanation:

Generally the profit maximizing level of activity is where the marginal revenue product of labor is equal to or greater than the wage rate paid. This means that the 5th worker is actually not generating any positive revenue for the farmer as its contribution to revenue is,

Total contribution = Marginal product * price = 3 * 2 = $6

Where as wage paid is $10 thus it gives a contribution of 6-10 = -$4.

Thus the farmer is advised to reduce labor employed.

Hope this helps.

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About 13 to 16 guests out of every 100 are purposefully out to scam us and get something for free.
antoniya [11.8K]

Answer:

True

Explanation:

2% out of 100 guest purposefully scam.

3 0
3 years ago
Read 2 more answers
Alternative A would involve substantial fixed but relatively low variable costs: fixed costs would be $250,000 per year, and var
stepladder [879]

Answer:

From zero to 33 boats option B would be best

Explanation:

Assuming the first alternative (A)is 250,000 fixed and 500 per boat

second (B) 2,500 cost per boat

and third (C) 50,000 fixed and 1,000 cost per boat

We want' to know at which level B would be the best option

we want to know when alternative C or A have a cost of 2,500 or lower:

A:

500 + \frac{250,000}{Q} = 2,500

\frac{250,000}{2,500 - 500} = Q

Q = 125

From this point, as fixed cost will be distribute among more units, the cost will decrease meaking C better than B

C:

1,000 + \frac{50,000}{Q} = 2,500

\frac{50,000}{2,500 - 1,000} = Q

Q = 33.33

From this point, as fixed cost will be distribute among more units, the cost will decrease meaking A better than B

From zero to 33 boats option B would be the best of the three options

6 0
3 years ago
g Oriole Company had actual sales of $1100000 when break-even sales were $660000. What is the margin of safety ratio? 67% 40% 33
Sonbull [250]

Answer:

40%

Explanation:

Oriole company has an actual sales of $1,100,000

The break even sales is $660,000

Therefore, the margin of safety can be calculated as follows

= Actual sales-break-even sales/actual sales

= $1,100,000-$660,000/$1,100,000

= $440,000/$1,100,000

= 0.4×100

= 40%

Hence the margin of safety is 40%

3 0
3 years ago
The Anderson Company has equal amounts of low-risk, average-risk, and high-risk projects. The firm's overall WACC is 12%. The CF
astra-53 [7]

Answer:

e. The company will take on too many high-risk projects and reject too many low-risk projects.

Explanation:

By using the WACC for discounting purposes in case of the higher risk projects the net present value would be greater in such cases and also the high discount rate is applied. It is easily accepted but at the same time it also rise the organization risk

Therefore in the given case, the option e is correct and the same is to be considered

8 0
3 years ago
Goodwill can be sold by itself to another company. can be purchased and charged directly to stockholders' equity. is only record
djyliett [7]

Answer:

What is the question? You did not ask a question.

Explanation:

All that was said was... Goodwill can be sold by itself to another company. can be purchased and charged directly to stockholders' equity. is only recorded when the purchase of an entire business occurs. may be expensed upon purchase if desired.

6 0
3 years ago
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