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According to the rule for optimal input usage, a firm should hire a person as long as her marginal revenue product is greater than her marginal cost to the company. It is well known that many companies have management training programs in which new trainees are paid relatively high starting salaries and arenot expected to make substantial contributions to the company until after the program is over (programs may run between 6 to 18 months).
In offering such training programs, is a company violating the optimality rule? Explain in detail.
In order to produce the wheels themselves, Pramble would have to add to existing facilities at a cost of $800,000. It estimates that its unit cost of production would be $3.50. At the current time, the company sells 10,000 carriages annually.
The "Big-Deal" Company has purchased new furniture for their offices at a retail price of $100,000. An additional $20,000 has been charged for insurance, shipping, and handling. The company expects to use the furniture for 10 years (useful life = ..
If the force of 25 N is distributed over an area of 15 cm2, find the angle of shear q shown, given that the shear modulus of the sole is 1.9 x 105 N/m2.
Suppose the Farsighted Forecasting Group, an organization of private economists, predicts that the output gap will fall by 4 percent over the next year. According to Okun's Law, by how much is the unemployment rate likely to rise?
Suppose that Roy could choose how many hours to work at a wage of W and choose to work 7 hours a day. The employer now offers him time-and-a-half wages(1.5W) for every hour he works beyond a minimum of 8 hours per day. Show how his budget constrai..
The contract on which you are bidding is the largest in your company's history and will involve about 20 sensors. Below are your historical records on installing these types of sensors.
Suppose the Canadian dollar (C$) price of one British pound is C$2.12. A hotel room in London costs 120 pounds, while a similar hotel room in Toronto costs C$250. In which city is the hotel room cheaper, and by how much
The RX Drug company has just purchased a capsulating machine for $76,000 the plant engineer estimates the machine has a useful life of 5 years and no salvage value. Compute the depreciation schedule using: a) Straight-line depreciation b) Double d..
which would have otherwise been sold for $180,000. The firm will borrow $750,000 to finance the acquisition. Total interest expense for 5-years is expected to approximate $350,000. What is the investment cost of the machine for capital budgeting p..
a. In which years did Argentina experience inflation In which years did it experience deflation (a falling price level) b. In which years did recessions occur In which years did expansions occur c. In which years do you expect the unmployment rate..
The amount of water consumed each day by a healthy adult follows a normal distribution with a mean of 1.54 liters. A sample of 10 adults after the campaign shows the following consumption in liters: 1.35 1.68 1.76 2.00 1.84 1.84 1.50 1.82 1.86 1.6..
Jonathan (a monopolist) maximizes profit by producing a quantity of 800 pillows where marginal cost is $2 and average cost is $4. Consumers are willing to pay as high as $10 per pillow when the quantity supplied is 800 pillows.
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