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nexus9112 [7]
3 years ago
5

The Skulls, a student social organization, has two different locations under consideration for constructing a new chapter house.

The Skulls' president, a POM student, estimates that due to differing land costs, utility rates, etc., both fixed and variable costs would be different for each of the proposed sites, as follows LocationAnnual FixedVariableAlpha Ave.$5,000 $200per personBeta Blvd.$8,000 $150per person If it is estimated that 30 persons will be living in this new chapter house, which location should the Skulls select
Business
1 answer:
dangina [55]3 years ago
7 0

Answer:

The Skulls

The location that Skulls should select is:

Alpha Avenue.

Explanation:

a) Data and Calculations:

Estimated number of persons living in this new chapter house = 30

                    Fixed       Variable                   Total Cost

Alpha Ave. $5,000       $200 per person     $11,000

Beta Blvd.  $8,000        $150 per person    $12,500

b) The location that Skulls should select must minimize the total cost.  The location which meets this criterion is Alpha Avenue, with a total cost of $11,000.  This is purely because of the number of persons living in the chapter house.  Assuming that this number would increase, then it may be considered economically better to choose the Beta Boulevard instead of the Alpha Avenue.

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Explanation:

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As the required rate of 13% is less than the IRR of 15%, the new machine will have a positive NPV.

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2 years ago
The nationwide company, Nightingale Health Systems, received a tax break from the government when it was faltering and ready to
Cerrena [4.2K]

Answer:

Subsidy

Explanation:

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3 years ago
Home Products, Inc., is planning the introduction of a new food dryer. To compete effectively, the dryer would have to be priced
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Answer:

The Target cost per dryer will be $35 per dryer

Explanation:

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2 years ago
Assume price exceeds average variable cost over the relevant range of demand. If a monopolistically competitive firm is producin
ivann1987 [24]

Answer:D) increase output.

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3 0
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