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allsm [11]
4 years ago
10

Suppose a firm is producing the profit-maximizing level of output and the MP of capital and labor are 10 and 20, respectively. I

f the wage is $10 and the rental rate for capital is $25, which of the following is true? To minimize costs the firm should
A. Use more capital.
B. Hire more labor and use less capital.
C. Hire less labor and use more capital.
D. Hire less labor.
Business
1 answer:
Darya [45]4 years ago
4 0

Answer:

B. Hire more labor and use less capital.

Explanation:

The firm producing at the profit-maximizing level of output means that Marginal Revenue = Marginal Cost, it can also be said that Marginal Productivity = Marginal wage/rent (Factor cost).

Therefore to minimize cost there should be a selection of factor mix that will be more efficient (i.e. comparing the cost of input to output) <u>which will be to use more of the cheaper input and less of the costlier input</u>

<u>Since the cost of labor is $10 and that of capital is $25, compared to the marginal productivity of 10 and 20 respectively, it can be seen that labor is the more efficient resource or factor. </u>

<u>Therefore</u><u> the cost minimizing choice of inputs</u><u> will be more of labor and less of capital will minimize costs</u>

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Deffense [45]

I believe he was successful due to his innovative production methods.

Hope this helps!!

3 0
4 years ago
Astin Company has current assets of $82,530, total assets of $242,050, total net income of $58,240, current liabilities of $72,1
Firdavs [7]

Answer:

a. 1.14

Explanation:

The current ratio is a financial measure that shows how many times the current assets of an entity may be used (covers) the current obligations (liabilities) of the entity.

It is given as current assets divided by current liabilities.

Astin Company’s current ratio

= $82530/$72120

= 1.14

This means that the current assets will settle the current liabilities 1.14 times.

6 0
4 years ago
When will the Social Security fund dry up at its current level?
dlinn [17]

C) social security will run out by 2042.

7 0
3 years ago
You are trying to decide which of two automobiles to buy. The first is American-made, costs $3.0500 x 104, and travels 28.0 mile
siniylev [52]

Answer:

Both cars(American and European) must travel 8,060 kilo metres each during their lifetime for the total cost(purchase cost + fuel equivalent) to be equivalent

Explanation:

With regards to the above, the cost equation for both cars will be equated together.

Furthermore, we will convert gallons into litres while also converting miles into kilometers.

Since 1 gallon has 3.785 litres; 1 mile also has 1.609 kilo metre, hence milage of the first car in kilo metre per litre would be ;

Milage American made = [ 28 miles × 1.609 ] / 3.785

= 11.90 kilo meter per litres.

Cost of Gas per litre = $3 per gallon / 3.785

= 0.79 per litre

Gas cost per kilo metre(American made) = 0.79 per litre / 11.90

= 0.066 per km

Gas cost per kilo metre(European made) = 0.79 per litre / 19.0

= 0.042 per km

We can sum up the equation of first car which is American made( Purchase price + Fuel cost)

We can make a be the number of kilo metres where total cost for both cars would be equal.

Total cost = 317.2 + 0.066a

Also, the total cost equation - purchase price + fuel cost of European car is represented as;

Total cost = 510.64 + 0.042a

317.2 + 0.066a = 510.64 + 0.042a

Collect like terms

0.066a - 0.042a = 510.64 - 317.2

0.024a = 193.44

a = 8,060 kilo metres

Therefore, both cars(American and European) must travel each 8,060 kilo metres in their life time for the total costs( purchase cost + fuel cost) to be equivalent.

5 0
4 years ago
An operations manager is most likely to be responsible for ________.
zysi [14]

<span>An operations manager is most likely responsible for logistics in which this is involved with the incoming flows of materials and how it goes out with the use of coordination and these materials that are evaluated are from finished products.</span>

4 0
3 years ago
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