Quantitative Problem 2: Carlysle Corporation has perpetual preferred stock outstanding that pays a constant annual dividend of $
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The answer is 7 bushels of wheat and 7 bushels of corn.
Referring to the diagram in the attached image.
If both Paul and Cliff dedicate their time entirely to one crop.
Paul can grow 8 bushels of wheat and Cliff can grow 6 bushels of wheat
Or Paul can grow 10 bushels of corn and Cliff can grow 4 bushels of corn.
But If they divide their time equally between the two crops, each can grow half of each crop,
Then Paul will be growing 4 bushels of wheat and 5 bushels of corn.
And Cliff will be growing 3 bushels of wheat and 2 bushels of corn.
Total production = Paul's production + Cliff's production
= (4 bushels of wheat+5 bushels of corn) + (3 bushels of wheat+2 bushels of corn)
= (4+3) bushels of wheat + (5+2) bushels of corn
= 7 bushels of wheat + 7 bushels of corn
Hence, total production is 7 bushels of wheat and 7 bushels of corn.
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