1.The copy of a company wants to expand production. It currently has 20 workers who share eight copiers. Two months ago, the firm added two copiers, and output increased by 20,000 pages per day. One month ago, the firm added five workers, and productivity also increased by 25,000 pages per day. A copier costs about four times as much as a worker.

Assume these increases in productivity per worker and productivity per copier are good proxies for future increases in productivity when hiring additional workers or purchasing additional copiers.

Based on this information, the copy company should in order to expand output.

A. hire another worker

B. purchase another copier

2. George's T-Shirt Shop produces 4,000 custom-printed T-shirts per month. George's fixed costs are $12,000 per month. The marginal cost per T-shirt is a constant $2.

George's break-even price is

per shirt.

Suppose George sells 50% more T-shirts per month.

At this quantity of shirts, George's break-even price is

per shirt.

3. Suppose an initial investment of $80 will return $40/year for three years (assume the $40 is received each year at the end of the year).

At a discount rate of 30%, this investment profitable. ( aor B)

1. Is
2. Is Not

4. A university spent $1.6 million to install solar panels atop a parking garage. These panels will have a capacity of 700 kilowatts (kW) and have a life expectancy of 20 years. Suppose that the discount rate is 30%, that electricity can be purchased at $0.10 per kilowatt-hour (kWh), and that the marginal cost of electricity production using the solar panels is zero.

Hint: It may be easier to think of the present value of operating the solar panels for 1 hour per year first.

Approximately how many hoursper yearwill the solar panels need to operate to enable this project to break even?

8,961.26

6,893.28

7,582.61

3,446.64

If the solar panels can operate only for 6,204 hours a year at maximum, the project break even. ( choose a or B)

1. Would
2. Would Not

Continue to assume that the solar panels can operate only for 6,204 hours a year at maximum.

In order for the project to be worthwhile (i.e., at least break even), the university would need a grant of at least

A. 127,991.65

B. 159,989.56

C. 79,994.78

D.223,985.38