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tacobeo tacobeo
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A year ago
The firm in the table below produces denim jeans and each unit of capital represents one sewing machine. The MRP for each of machines 10 through 14 is provided. Each sewing machine delivers a stream of MRPs beginning one year from now, for a total of 2 years. Assume that after 2 years each sewing machine is worth nothing.

Number of
Sewing Machines		Annual MRP
10$2000
11$1800
12$1600
13$1400
14$1200

TABLE 15-2

Refer to Table 15-2. If the interest rate is 4%, and the purchase price of a sewing machine is $3000, what is the optimal capital stock (number of sewing machines) for this firm?

▸ fewer than 10

▸ 12

▸ more than 12

▸ 10

▸ 11
Textbook 
Microeconomics

Microeconomics


Edition: 17th
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naj2008hnaj2008h
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A year ago
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