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Aleonysh [2.5K]
3 years ago
14

A firm facing a price of $10 in a perfectly competitive market decides to produce 100 widgets. If its marginal cost of producing

the last widget is $12 and it is seeking to maximize profit, the firm should ______.
Business
1 answer:
wel3 years ago
8 0

Answer:

produce fewer widgets until the marginal cost = $10

Explanation:

In a perfectly competitive market, all suppliers and consumers are price takers, so this company cannot increase its price so that it matches its marginal cost. Therefore, the only option it has is to try to lower its marginal cost is by lowering total production.

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A company is considering replacing an old piece of machinery, which cost $400,000 and has $175,000 of accumulated depreciation t
tamaranim1 [39]

Answer:

Company A

a. Differential Analysis dated May 29

                                              Alternative 1           Alternative 2

Opportunity cost                       $250,000            $550,000

Variable production costs          580,000                192,000

Total cost                                  $830,000             $742,000

b. Sunk cost in this situation is: $225,000 ($400,000 - $175,000) cost of the old machine.

Explanation:

Company A's relevant cost for the old machine is the opportunity cost that it will lose if it continues with Alternative 1 or continued use of the old machine and the additional cost for the new machine for Alternative 2.  Also relevant is the variable production costs that would be incurred if the old or new machine is used.

Company A's sunk cost is the cost of the old machine minus accumulated depreciation.  Sunk cost is not relevant for decision making under differential analysis.

Company A's differential analysis is a managerial tool that is used to differentiate one decision alternative from another.  In this analysis, only relevant costs are considered.  A relevant cost in this case is cost that its inclusion or elimination makes a difference in the decision outcome.

8 0
3 years ago
An investment pays $400 in one year, X amount of dollars in two years, and $500 in three years. The total present value of all t
k0ka [10]

Answer:

X = 789.70

Explanation:

we solve for X considerign each deposit is discounted at the given rate using the lump sum formula:

\frac{Maturity}{(1 + rate)^{time} } = PV

\frac{400}{1.06}+\frac{X}{1.06^2}  +\frac{500}{1.06^3} = 1,500\\X= (1,500 - \frac{400}{1.06} - \frac{500}{1.06^3}) \times 1.06^2

X = 789.7018868

6 0
3 years ago
Listed below are several document terms. Match each term with the corresponding statement in the list provided. Some terms may b
GrogVix [38]

Answer:

1. The raw materials record

is a control for the materials stored in the storeroom. In order to get direct​ materials, a(n) materials requisition

must be presented.

2. Before production​ begins, the​ manufacturer's purchasing department issues purchase orders

to its supplier for needed direct materials.

3. A(n) receiving report

is typically a duplicate of the purchase order but without the quantity​ pre-listed on the form.

4. The bill of materials

is like a list of ingredients in a​ recipe, stating the materials needed to produce a product.

5. A(n) job cost record

is used to accumulate all of the costs affiliated with each job.

6. All direct laborers in the factory fill out​ a(n)

labor time record.

7. The accounting department will not pay​ a(n)

invoice unless it agrees with the quantity of parts both ordered and received.

8. Each item in the raw materials storeroom has its own raw materials record.

Explanation:

1. The raw materials record

is a control for the materials stored in the storeroom. In order to get direct​ materials, a(n) materials requisition

must be presented.

2. Before production​ begins, the​ manufacturer's purchasing department issues purchase orders

to its supplier for needed direct materials.

3. A(n) receiving report

is typically a duplicate of the purchase order but without the quantity​ pre-listed on the form.

4. The bill of materials

is like a list of ingredients in a​ recipe, stating the materials needed to produce a product.

5. A(n) job cost record

is used to accumulate all of the costs affiliated with each job.

6. All direct laborers in the factory fill out​ a(n)

labor time record.

7. The accounting department will not pay​ a(n)

invoice unless it agrees with the quantity of parts both ordered and received.

8. Each item in the raw materials storeroom has its own raw materials record.

7 0
4 years ago
Remington Arms is investigating its capacity to exploit new markets. Specfically, the firm is critically evaluating its availabl
zhuklara [117]

Answer: Critical resources

Explanation:

The critical resources are the types of resources that are only used for one time when the schedule gets increased and it basically refers to the time when the resources become overloaded.

According to the question, the Remington arms basically analyzing its specific capacity for exploiting the various types of new products and the services in the market.

In this process, the organization is typically evaluating its available capital in an organization and the various types of technical and the management expertise.

Therefore, Critical resources is the correct answer.

6 0
4 years ago
A farm is currently producing at point C on this curve.
lord [1]

Answer:

the farm would face trade offs in production of apples or oranges

Explanation:

i have a brain and I used it

8 0
4 years ago
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