Business, 27.11.2019 06:31 YungKardon
Afirm in a competitive industry has a total cost function of tc = 0.2 q2 – 5q + 30, whosecorresponding marginal cost curve is mc=0.4q – 5. if the firm faces a price of 6,
a)what quantity should it sell? (10 points)
b)what profit does the firm make at this price? (10 points)
c)should the firm shut down? (10 points)
Answers: 1
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Amachine purchased three years ago for $720,000 has a current book value using straight-line depreciation of $400,000: its operating expenses are $60,000 per year. a replacement machine would cost $480,000, have a useful life of nine years, and would require $26,000 per year in operating expenses. it has an expected salvage value of $130,000 after nine years. the current disposal value of the old machine is $170,000: if it is kept 9 more years, its residual value would be $20,000. calculate the total costs in keeping the old machine and purchase a new machine. should the old machine be replaced?
Answers: 2
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Business, 23.06.2019 00:30
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