Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

A hamburger factory produces 50,000 hamburgers each week. The equipment used costs $8,000 and will remain productive for three years. The labor cost per year

image text in transcribed
A hamburger factory produces 50,000 hamburgers each week. The equipment used costs $8,000 and will remain productive for three years. The labor cost per year is $12,500. a. What is the productivity measure of "units of output per dollar of input" averaged over the three-year period? Assume that there are 52 weeks per year. Round your answer to one decimal place. Productivity: hamburgers/dollar b. The company has the option of purchasing equipment for $11,000, with an operating ife of four years. It would reduce labor costs to $10,000 per year. Should it consider purchasing this equipment (using productivity arguments alone)? Assume that there are 52 weeks per year. Round your answer for productivity to one decimal place. For the expensive machine, productivity is hamburgers/dollar input. Because the productivity of the expensive machine is it would be a -Select- Investment based on this single criterion. -Select

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Business Finance

Authors: Brian Watts

8th Edition

0712110720, 978-0712110723

More Books

Students also viewed these Finance questions

Question

25.0 m C B A 52.0 m 65.0 m

Answered: 1 week ago