Edward the entrepreneur takes 2 hours to cut a lawn, and he cuts 1,000 lawns per year. He uses solar-powered equipment (truck and mower) that will last forever- and can be sold at any time for $40,000. Edward could earn $11 per hour as a pedicurist. The interest rate is 10 percent. Given his current output level, compute his average cost of cutting lawns. ○ $20 ○ $24 ○ $22 ○ $28 O $26

Edward the entrepreneur takes 2 hours to cut a lawn, and he cuts 1,000 lawns per year. He uses solar-powered equipment (truck and mower) that will last forever- and can be sold at any time for $40,000. Edward could earn $11 per hour as a pedicurist. The interest rate is 10 percent. Given his current output level, compute his average cost of cutting lawns. ○ $20 ○ $24 ○ $22 ○ $28 O $26

Managerial Economics: A Problem Solving Approach

5th Edition

ISBN:9781337106665

Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Chapter7: Economies Of Scale And Scope

Section: Chapter Questions

Problem 7.5IP

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The manager of the donut shop tells you that hesells donuts for $1 each, and that if he were to makeadditional donuts, based on his current level ofoutput, it would cost him $0.80 per donut. Do yourecommend that the manager increase or decreasethe number of donuts he makes?
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Josh and Alex work as design engineers creating high-end lighting fixtures. After one particularly enlightened afternoon, they decide to follow their dreams and open a cupcake bakery. Please sort their various costs, listed below, into the correct category. Implicit Costs Not a Cost Explicit Costs ! Q A N Ⓒ2 Advertising space taken out on a social networking website The money they pay their neighbor's six year old son to deliver cupcakes to their customers. W S 12 #3 16 80 F3 E D X C $ 4 888 F4 R his previous job designing The salary Alex earned in lighting fixtures. LL 25 % U The garage space used for baking that can no longer be rented out to a college student FS T Da A 6 V B Y Supplies like sugar, butter and baking trays G H Ⓒ Previous Check Answer Next Exit 87 & 44 N 17 U J * 8 ∞ 3 14 9 K → 19 O 1 AA F10 P
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apter 1 Connect Activity i 6 eBook The table below shows Lanark's production possibilities. Wheat Cars A 0 51 B 50 49 C 88 44 D 114 34 27 E 126 19 F 131 0 a. If Lanark is producing 39 cars, it can produce approximately b. If Lanark is currently producing combination C, the cost of 26 more wheat is (Click to select) ✓ c. If Lanark is currently producing combination D, the approximate per unit cost of an additional car is necessary, round your answers to 1 decimal place. Remember to round 0.05 up to 010. Saved wheat. (Click to select) If
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Conner runs two kinds of rafting trips. If he spends all day on a wild whitewater rafting, he can do 3 trips, or he can do 4 trips of a mellow wildlife rafting. If he does some of each, however, he can do more total trips: 2 whitewater trips and 3 wildlife trips. Conner’s time is valued at $20/hour. Finding the value for the economies of scope of Conner’s rafting experience. What can you say about his economies of scope? i.e., does Conner reduce the average cost by making some of each trip or by making each trip separately? Show your work.