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Lynna [10]
3 years ago
15

Alex has allocated his income in such a way that the marginal utility of the last unit of product X he consumes is 40 utils and

that of the last unit of Y is 16 utils. If the unit price of X is $5, then the price of Y must be ________.
A. $1 per unit.
B. $2 per unit.
C. $3 per unit.
D. $4 per unit.
Business
1 answer:
ikadub [295]3 years ago
6 0

Answer:

The price of product Y is B) $2 per unit.

Explanation:

Marginal utility is the satisfaction derived from the consumption of an additional unit of a product or commodity. When calculating for the utility maximization, one has to consider four things;- The products or commodities in question as well their different prices. The utility maximization is calculated using the formula; MU(X) ÷ P(X) = MU(Y) ÷ P(Y). MU(X) and P(X) here represents marginal utility of product X and price of X  respectively while MU(Y) and P(Y) represents marginal utility of Y and price of product Y respectively. This is thus solved without the price of Y. So, P(Y) is an unknown assumed as A.

Therefore, MU(X) ÷ P(X) = MU(Y) ÷ P(Y) is replaced with figures; 40 utils ÷ $5 = 16 utils ÷ $A

Using cross multiplication, we have 40A = 80; A = 80 ÷ 40 = 2

Therefore. $2 per unit is the price of product Y

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Leno4ka [110]

The republic of south Africa exports edible fruits and nuts into the common market known as the European union, and imports from the European union other products which south Africa could produce but at a higher cost than what it costs the Europeans to produce. this practice follows the theory of comparative advantage.

Comparative gain is an economic system's potential to supply a specific proper or provider at a reduced possibility rate than its buying and selling partners. Comparative benefit is used to provide an reason for why organizations, countries, or people can benefit from trade.

For instance, if a country is skilled at making each cheese and chocolate, they will decide how much tough work is going into producing each right. If it takes one hour of exertions to produce 10 devices of cheese and one in each of of tough paintings to deliver 20 devices of chocolate, then this united states has a comparative benefit in making chocolate.

Comparative advantage, monetary precept, first developed via 19th-century British economist David Ricardo, that attributed the reason and advantages of global alternate to the variations within the relative possibility costs (prices in phrases of other objects given up) of producing the same commodities amongst global locations.

Learn more about Comparative advantage here: brainly.com/question/15361275

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5 0
1 year ago
Once you've found your target market, your business is on track, and your customers seem satisfied, ongoing market research can
Murljashka [212]

Answer:

1st question: B. inform you of coming trends.

Even after understanding your customer segment and satisfying your customers, you have to keep up with the market trends and the changing needs of customers if you need to be successful.

2nd question: C. Provide check boxes for each choice.

A simple question and check box type questionnaire is the best way to get customer feedback as it consumes less time to fill.

Explanation:

4 0
3 years ago
Your firm has net income of $245 on total sales of $1,080. Costs are $610 and depreciation is $120. The tax rate is 30 percent.
RSB [31]

Answer:

the operating cash flow is $365

Explanation:

the computation of the operating cash flow is shown below:

operating cash flow is

= Net income + depreciation expense

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= $365

hence, the operating cash flow is $365

We simply added the net income and the depreciation expense to determine the operating cash flow  

3 0
2 years ago
Your firm is considering opening a branch office in Kyle. The office would cost $485,000 to build the office. During the office
wariber [46]

Answer:

The NPV from opening the branch office is negative ( -$106668.08). Thus the branch office should not be opened.

Explanation:

The decision to open the branch office will be taken based on the NPV provided by opening of the branch office. If the NPV of a project is positive based on the required rate of return used as a discount rate fro cash flows, the investment is worth undertaking.

The net present value (NPV) for a project can be calculated as,

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Where,

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As the required return is 16%, we will take this as the appropriate discount rate.

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NPV = - $106668.08

As the NPV from project is negative at a required return of 16%, the project should not be under taken and the branch office should not be open.

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