Consider a company that can invest capital to generate revenue and assume that the marginal revenue from the first five units of capital is as follows: 1st has MR 2.25, 2nd has MR 1.75, 3rd has MR 1.40, 4th has MR 1.24 and 5th has MR 1.17. If the interest rate is given at 20%, what is the optimal amount of capital for the company to borrow? 2 3 4 5

Consider a company that can invest capital to generate revenue and assume that the marginal revenue from the first five units of capital is as follows: 1st has MR 2.25, 2nd has MR 1.75, 3rd has MR 1.40, 4th has MR 1.24 and 5th has MR 1.17. If the interest rate is given at 20%, what is the optimal amount of capital for the company to borrow? 2 3 4 5

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter16: The Markets For Labor, Capital, And Land

Section: Chapter Questions

Problem 12P

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