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dusya [7]
3 years ago
10

Assume that both labor and capital exhibit diminishing returns. Suppose you can hire an additional unit of labor for $10, and sh

e can product 50 units. You could also buy an additional machine at the cost of $200, and that machine would allow you to produce 1000 units.
If your main concern is minimizing average cost, what should you do?
a) Buy the machine, because it will allow you to produce more
b) Nothing, because you are already minimizing cost
c) There is not enough information to make a legitimate response
d) Hire more labor, because it is cheaper
Business
1 answer:
anygoal [31]3 years ago
4 0

Answer:

b) Nothing, because you are already minimizing cost

Explanation:

cost of producing one additional unit by hiring more workers = $10 / 50 units = $0.20 per unit

cost of producing one additional unit by buying the machine = $200 / 1,000 units = $0.20 per unit

Since labor exhibits a diminishing return, the next unit of labor will produce less than 50 units. This means that if you want to increase production, you should buy the machine.

Using the same logic, the previous units of labor were able to produce more than 50 units, which means that the average total cost was lower using labor than the machine. So if the company's concern is to minimize costs, then they are already doing so.

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ludmilkaskok [199]

Answer:

1. Transaction will have effects on Balance Sheet in the Assets Section and will be classified as an Investing Activity in the Statement of Cash flows.

2. Transaction will have effects on Balance Sheet in the Liability Section and will be classified as a Financing Activity in the Statement of Cash flows.

3. Transaction will have effects on Income Statement in the Revenue Section and will be classified as an Operating Activity in the Statement of Cash flows.

4. Transaction will have effects on Income Statement in the Revenue Section and will be classified as an Operating Activity of the Statement of Cash flows.

5. Transaction will have effect on Income Statement in the Expense Section and will be classified as a Financing Activity in the Statement of Cash flows.

Explanation:

1. Falcon purchases common stock of Wildcat. This is classified in the investments tab of the assets account. This will be reflected in balance sheet. The transaction is classified in the investing activity.

2. Falcon borrows from Wildcat and signs Notes payable this will have effects in balance sheet liability account. This is financing activity.

3. Falcon receives Dividend revenue from Wildcat. This will be reflected in income statements as revenue. It will operating activity.

4. Falcon provides services to Wildcat , this is reflected in income statement as revenue. This will appear under operating activity.

5. Falcon pays interest on the borrowings to Wildcat. This is income statement items and is an expense. It belongs to financing activity.  

7 0
3 years ago
Sale of partnership interestThe partners in the Biz Partnership have agreed that partner Mandy may sell her $100,000 equity in t
ddd [48]

Answer:

Mandy Capital                                                Debit: 100,000

Brittney Capital                                               Credit: 100,000

Explanation:

The journal entry will be recorded as above. Mandy sold equity worth $100,000, so we will record the entry on transfer of equity by the equity value sold. Now, for this equity value both partners can decide the amount in which one will sell to other, which in this scenario is $85,000.

5 0
3 years ago
Explain what is meant by "Information Technology (IT) flattens organizations?
Shalnov [3]

Answer: The answer is given below

Explanation:

Information Systems are the networks of both the hardware and the software which is used by economic agents to collect, process, create and help in the distribution of data.

Information Technology (IT) flattens organizations simply means that information systems can help in the reduction of the levels in an organization through the provision of information to managers which will be used in the supervision of other emoloyees and also, lower-level employees could be given more authority relating to decision-making.

Since decision making has been pushed to lower level then fewer managers will be needed. This ensures that faster decision making are made and there's increase in the span of control.

5 0
2 years ago
When agent Tom meets with his sellers to explain his advertising plan, he should make sure the owners understand that:__________
laiz [17]

Answer:

Advertising a similar property can and does create interest in their property

Explanation:

In real estate agents need to effectively market properties in order to sell to consumers.

One way of doing this is by creating awareness in a given market about a particular property type.

When interest in a type of property is created it generates interest that will lead to more sales.

In the given scenario when Tom meets with his sellers to explain his advertising plan, he should make sure the owners understand that to capture a market they need to advertise even products that are similar.

As interest grows it will create a demand for that type of property

7 0
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Marrrta [24]

Explanation:

The motivation for consumption comes from individual needs and desires, which may occur consciously and unconsciously. To meet their needs and wants, people identify and buy products and services that are compatible with their satisfaction.

There are several surveys and studies that seek to identify consumer behavior and explain how the purchasing decision process occurs. One of the most widespread theories in the world is Maslow's theory, which presented a hierarchy of needs that aims to identify a priority system of human needs satisfaction, divided into five parts, which are arranged in order of importance:

  1. physiological,
  2. safety,
  3. love,
  4. esteem and
  5. self-actualization

This theory is of great relevance to help marketers target their strategy according to the priority and need of individuals, including in their campaigns messages that send the consumer a sense of urgency for the product or service, directing marketing communication to the bottom of the hierarchy, which is the consumer's priority.

3 0
3 years ago
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