The budget constrain is how much of each good can Joe's buy and it's given by:
Income = P_f * Q_f +P_s * Q_s
P_f = Price_of_Food
Q_f = Quantity_of_Food
P_s = Price_of_Shelter
Q_s = Quantity_of_Shelter
In case a):
300 = 5*Q_f(a) + 100*Q_s
in case b):
300 = 10*Q_f(b) + 100*Q_s
To draw each line, you can make a graphic in which the x axis is Q_s and y axis is Q_f
set Q_f = 0 and solve for Q_s which gives => Q_s = 3 so, in the x axis the line will start in Q_s = 3
the same, and solve for Q_f and it'll give =>
Q_f(a) = 60
Q_f(b) = 30
So, from the start in x axis in Q_s = 3 you draw the line (a) to the y axis Q_f(a) = 60 and you draw the line (b) to the y axis Q_f(b) = 30
To get the oportunity cost you have to divide the cost of what is given up (food) by what is gained (shelter).
Oportunity_Cost_Food(a) = 5/100 = 0.05
Oportunity_Cost_Food(b) = 10/100 = 0.10
As you can see, the oportunity cost of food increase
Answer:
The answer to this question is (c) Labour, Labour intensive
In the 2-factor, 2-good Heckscher-Ohlin model, the country with a relative abundance of labour will have a production possibility frontier that is biased toward production of the labour intensive good
Explanation:
The Heckscher-Ohlin model is an economic theory that proposes that countries export what they can most efficiently and plentifully produce.
The model emphasizes the export of goods requiring factors of production that a country has in abundance. It also emphasizes the import of goods that a nation cannot produce as efficiently. It takes the position that countries should ideally export materials and resources of which they have an excess, while proportionately importing those resources they need.
Therefore in regard to the question above,
In the 2-factor, 2-good Heckscher-Ohlin model, the country with a relative abundance of labour will have a production possibility frontier that is biased toward production of the labour intensive good
Hence the answer is the third option, Labour, Labour intensive
Answer:
the maximum loan could bank made as the direct result of the deposit is $1,800
Explanation:
The computation of the maximum loan could bank made as the direct result of the deposit is given below:
= Deposit amount × (1 - required reserve ratio)
= $2,000 × (1 - 0.10)
= $2,000 × 0.90
= $1,800
hence, the maximum loan could bank made as the direct result of the deposit is $1,800
Answer:
$28
Explanation:
Step 1:
If a company sells a product at $60 each and makes a sale of $15,000, the number of units of items produced is
$15,000 ÷ $60 = 250 units.
Step 2:
To calculate the company's contribution margin per unit,
we have, (unit selling prices - unit production cost)
unit selling price is #60
unit cost of production is (total cost of prodcution ÷ number of units)
total cost of production is $4,000+ $1,000+ $2,000+ $1,000 = $8000
Unit cost of production is $8000 ÷ 250 = $32
i.e it takes $32 to manufacture 1 product.
Contribution margin = $60 - $32
= $28
∴ the contribution margin is $28.
Cheers.
Answer:
The optimal production plan gives a total costs of $417,672 for the periods Feb to May
In Feb we will have to hire 26 workers to close the gap between demand and production from our 100 existing workers
In March however, we will have to lay them off (26 workers) to keep our production in line with demand.
In April, we are constrained to 100 workers, thus requiring that we run overtime. The overtime requirement is between 3,060 hours to max of 5,000 hours. Note that inspire of the hours chosen, demand for April still won't be fulfilled.
The best option will be the one that gives us last backlog because of the costs of backorder being extremely costly.
5,000 overtime hours in April is the best option .
In May, we are constrained to our 100 workers, meaning we will fulfill our back orders and also retain inventory in hand of 7,760 units.
The 3 pages attached show how the cost is worked out and the presentation as well.
