Answer:
$43
Explanation:
The total cost incurred by the company is made of two classes of cost namely; Fixed and variable cost. While the fixed cost is constant, the variable cost is dependent on the number of tractors produced.
A such,
Fixed cost = $550,000
Variable cost = 22000 × $180 = $396,000
Total cost = $550,000 + $396,000
= $946,000
The average cost per tractor is the result of the ratio of the total cost to the number of tractors
average cost per tractor = $946,000/22,000
= $43
Answer:
Government Solution : Pollution Emission Permits, 'Cap & Trade' pollution Economic Incentive, Pigovian Tax
Explanation:
Pollution is a negative externality, which has extra negative side effect (social cost), not accomodated in the market price.
The optimal pollution level is where : marginal cost of pollution abatement = marginal benefit from pollution abatement. Given, government knows the marginal cost of abatement (firm cost to reduce cost at each quantity) & the determined optimal quantity of population.
Then, it should allocate the optimal pollution level as 'pollution emission permits' among all the pollutant firms. 'Cap & trade' system can also be used as economic incentive. It implies firms having less pollution emissions than the pollution emission permits, can sell their pollution permits to other firms, needing to emit pollution more than the permissible limit. Government can also apply pigovian tax = marginal social cost of the extra pollutant emission at the optimal level, to ensure pollution emission at optimal level.
The answer is 12 percent total
Answer:
a) $425,320,48
b) $177,494,02
Explanation:
The avoidable interest = $425,320,48
The Depreciation Expense= $177,494,02.
Kindly go through the attached file to see the step by step approach that yielded the answers from the question.