Question

Question 1)

A company is considering expanding their production capabilities with a new machine that costs $47,000 and has a projected lifespan of 10 years. They estimate the increased production will provide a constant $5,000 per year of additional income. Money can earn 0.6% per year, compounded continuously. Should the company buy the machine?

Question 2)

Find the accumulated present value of an investment over a 6 year period if there is a continuous money flow of $5,000 per year and the interest rate is 0.7% compounded continuously.

Question 3)

Given: (*x* is number of items)

Demand function: d(x)=420.5−0.3x2d(x)=420.5-0.3x2

Supply function: s(x)=0.2x2s(x)=0.2x2

Find the equilibrium quantity:

Find the producers surplus at the equilibrium quantity

Question 4)

Given: (*x* is number of items)

Demand function: d(x)=583.2−0.5x2d(x)=583.2-0.5x2

Supply function: s(x)=0.3x2s(x)=0.3x2

Find the equilibrium quantity:

Find the consumers surplus at the equilibrium quantity:

Question 5)

Given: (*x* is number of items)

Demand function: d(x)=300−0.6xd(x)=300-0.6x

Supply function: s(x)=0.2xs(x)=0.2x

Find the equilibrium quantity:

Find the producers surplus at the equilibrium quantity:

Answer #1

A company is considering expanding their production capabilities
with a new machine that costs $67,000 and has a projected lifespan
of 9 years. They estimate the increased production will provide a
constant $8,000 per year of additional income. Money can earn 1.8%
per year, compounded continuously. Should the company buy the
machine? $ _____ over the life of the machine

A company is considering expanding their production capabilities
with a new machine that costs $43,000 and has a projected lifespan
of 7 years. They estimate the increased production will provide a
constant $7,000 per year of additional income. Money can earn 1.7%
per year, compounded continuously. Should the company buy the
machine?
$ over the life of the machine

A company is considering expanding their production capabilities
with a new machine that costs $102,000 and has a projected lifespan
of 9 years. They estimate the increased production will provide a
constant $12,000 per year of additional income. Money can earn 0.6%
per year, compounded continuously. Should the company buy the
machine?
Select an answer Yes, the present value of the machine is greater
than the cost by $________ over the life of the
machine

A company is considering expanding their production capabilities
with a new machine that costs $43,000 and has a projected lifespan
of 8 years. They estimate the increased production will provide a
constant $6,000 per year of additional income. Money can earn 1.4%
per year, compounded continuously. Should the company buy the
machine?
Select an answer Yes, the present value of the machine is greater
than the cost by No, the present value of the machine is less than
the cost...

A company is considering expanding their production capabilities
with a new machine that costs $79,000 and has a projected lifespan
of 8 years. They estimate the increased production will provide a
constant $10,000 per year of additional income. Money can earn 1.2%
per year, compounded continuously. Should the company buy the
machine over the life of the machine
Select an answer: Yes, the present value of the machine is greater
than the cost by $_____________
No: the present value...

9) A company is considering expanding their production
capabilities with a new machine that costs $37,000 and has a
projected lifespan of 6 years. They estimate the increased
production will provide a constant $6,000 per year of additional
income. Money can earn 0.9% per year, compounded continuously.
Should the company buy the machine?
(a) Yes, the present value of the machine is greater than the
cost by
(b) No, the present value of the machine is less than the cost...

The demand function for a certain brand of CD is given by
p = −0.01x2 −
0.2x + 14
where p is the unit price in dollars and x is
the quantity demanded each week, measured in units of a thousand.
The supply function is given by
p = 0.01x2 +
0.7x + 3
where p is the unit price in dollars and x
stands for the quantity that will be made available in the market
by the supplier, measured...

The demand function for a certain brand of CD is given by p =
−0.01x^2 − 0.2x + 11 where p is the wholesale unit price in dollars
and x is the quantity demanded each week, measured in units of a
thousand. The supply function is given by p = 0.01x^2 + 0.4x + 3
where p is the unit wholesale price in dollars and x stands for the
quantity that will be made available in the market by the...

The demand function for Internet cameras is given by
PX=60-X. The marginal cost curve is MC =
10. Assume that there is a competitive equilibrium
in the market currently.
Find the equilibrium price and quantity in the market.
Calculate consumers’ surplus.
Calculate the producers’ surplus (profit).
Draw the supply and demand curve (on the same plane). On it,
mark the equilibrium price and quantity, consumers’ surplus (mark
the area) and producers’ surplus (mark the area).
Is the outcome Pareto...

The demand for a particular item is given by the demand
function
1. D(x)=200−x^2
Find the consumer's surplus if the equilibrium point
(Xe,Pe)=(5,175) Round to the nearest cent.
$____
2. The demand for a particular item is given by the function
D(x)=1,350−3x^2. Find the consumer's surplus if the equilibrium
price of a unit $150
The consumer's surplus is $___
3. The demand for a particular item is given by the function
D(x)=120/x+6. Find the consumer's surplus if the equilibrium price...

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