In traditional Economic analysis, Group of answer choices only marginal costs are relevant to current economic decision making. only average costs are relevant to current economic decision making. both marginal and sunk costs are relevant to current economic decision making. only costs that have already been incurred are relevant to current economic decision making.

In traditional Economic analysis, Group of answer choices only marginal costs are relevant to current economic decision making. only average costs are relevant to current economic decision making. both marginal and sunk costs are relevant to current economic decision making. only costs that have already been incurred are relevant to current economic decision making.

Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)

14th Edition

ISBN:9781305506381

Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Chapter8: Cost Analysis

Section: Chapter Questions

Problem 1E

See similar textbooks

Similar questions

A company produces a single, high-volume product. One year its production volume was 780,000 units, its fixed costs were $3.2 million and its variable costs were $16 per unit. What was the company's average cost per unit produced? Group of answer choices $20.10 $4.10 $16.00 $36.10
The decision-making process where costs and benefits are usually measured in dollars is called a(n) __________ analysis. Group of answer choices sum total quantitative aggregate cost–benefit
____ are defined as costs which are incurred regardless of the alternative action chosen in a decision-making problem.
Cost of next best alternatives opportunity given up is called __________
A European consortium has spent a considerable amount of time andmoney developing a new supersonic aircraft. The aircraft gets high markson all performance measures except noise. In fact, because of the noise,the consortium’s management is concerned that the U.S. government mayimpose restrictions on some of the American airports where the aircraftcan land. Management judges a 50–50 chance that there will be somerestrictions. Without restrictions, management estimates its (presentdiscounted) profit at $125 million; with restrictions, its profit would beonly $25 million. Management must decide now, before knowing thegovernment’s decision, whether to redesign parts of the aircraft to solvethe noise problem. The cost of the redesign program is $25 million. Thereis a .6 chance that the redesign program will solve the noise problem (inwhich case, full landing rights are a certainty) and a .4 chance it will fail. Using a decision tree, determine the consortium’s best course ofaction, assuming…
in building their plant, the officers of the international leather company had the choice between alternatives: one alternative is to build in metro manila where the plant would cost p2,000,000. labor would cost annually p120,000 and annual overhead p40,000. taxes and insurance would total 5% of the first cost of the plant. the second alternative would be to build in bulacan a plant costing p2,250,000. labor would cost annually p100,000 and overhead would be p55,000. taxes and insurance would total 3% of the first cost. the cost of raw materials would be the same in either plant. if capital must be recovered within 10 years and money is worth at least 20%, which site should the officers of the company choose?
No written by hand solution 1.Factory does not install scrubber,Farmer uses south field Crop Damage ($)= 120 Farmer cost ($)=0 Factory Cost($)=0 Social cost =120 2. Factory does not install scrubber, Farmer rents west field Crop Damage ($) = 50 Farmer cost ($)=20 Factory Cost($)=0 Social cost =70 3.Factory installs scrubber,Farmer uses south field Crop Damage ($)= 35 Farmer cost ($)=0 Factory Cost($)=40 Social cost =75 4.Factory installs scrubber,Farmer rents west field Crop Damage ($)=0 Farmer cost ($)=20 Factory Cost($)=40 Social cost = 60 A ) Suppose that the factory has the right to pollute and is under no legal obligation to install the scrubber. What is the farmer’s willingness to pay to induce the factory to install the scrubber? Why? B )Suppose that the factory has the right to pollute and is under no legal obligation to install the scrubber. What is the factory’s willingness to accept in order to install the scrubber to abate its pollution? Why? C )Under the property rule…
Selling price per large Snowie $ 5.00 Ice per Snowie $ 0.20 Spoon straw (need one per Snowie) $ 0.02 Styrofoam cup (need one per Snowie) $ 0.08 Napkin (need two per Snowie) $ 0.02 Servings per gallon of syrup 28 Cost per gallon of syrup (includes concentrate, preservative, and sugar) $ 8.00 Hourly rate for workers $ 10.00 Event registration fee per day $ 25.00 Electricity, insurance, maintenance, and permit costs per month $ 250.00 Kiosk rental cost per month $ 650.00 Purchase cost of two ice shavers (5-year life) $ 3,180.00 Purchase cost of a flavor station (5-year life) $ 1,080.00 a. Number of days you anticipate opening the kiosk per month 20 b. Number of hours you will work (no wages required) per day 6…
In the design of a jet engine part, the designer has a choice ofspecifying either an aluminium alloy casting or a steel casting. Either materialwill provide equal service, but the aluminium casting will weigh 1.2 kg ascompared with 1.35 kg for the steel casting.The aluminium can be cast for $. 80.00 per kg. and the steel one for$ 35.00 per kg. The cost of machining per unit is $. 150.00 for aluminiumand $. 170.00 for steel. Every kilogram of excess weight is associated witha penalty of $. 1,300 due to increased fuel consumption. Cost of using aluminium metal for the jet engine part?
A European consortium has spent a considerable amount of time and money developing a new supersonic aircraft. The aircraft gets high marks on all performance measures except noise. In fact, because of the noise, the consortium’s management is concerned that the US government may impose restrictions on some of the American airports where the aircraft can land. Management judges a 50–50 chance that there will be some restrictions. Without restrictions, management estimates its (present discounted) profit at $125 million; with restrictions, its profit would be only $25 million. Management must decide now, before knowing the government’s decision, whether to redesign parts of the aircraft to solve the noise problem. The cost of the redesign program is $25 million. There is a 0.6 chance that the redesign program will solve the noise problem (in which case, full landing rights are a certainty) and a 0.4 chance it will fail. Using a decision tree, determine the consortium’s best course of…
This does not solve for the Present Worth of Costs
The great expert Hand written solution is not allowed Give explanation of the correct option and explanation of the incorrect options