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Author Question: A firm can invest in one of two projects: the purchase of new manufacturing equipment or the ... (Read 82 times)

big1devin

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on: Apr 19, 2019

A firm can invest in one of two projects: the purchase of new manufacturing equipment or the training of its factory workers in the better use of time management. Both projects cost the same amount of money. The purchase of new manufacturing equipment is expected to reduce costs by $10,000 each year for 5 years. The training of the factory workers in the better use of time management is expected to increase revenues by $10,000 each year for 10 years. Which of the following is 
true?


◦ Each of these projects would have the same expected rate of return, as they both cost the same.
◦ The purchase of new manufacturing equipment would have the higher expected rate of return, as it increases revenues whereas the training of factory workers in the better use of time management only reduces costs.
◦ The training of factory workers would have the higher expected rate of return, as it will reduce costs for a longer time period than the purchase of new manufacturing equipment will increase revenues.
◦ The expected rates of return for these two projects cannot be compared, as one project reduces costs and the other increases revenues.
Principles of Economics ¦ Case, Fair, Oster ¦ 12th Edition
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Marked as best answer by big1devin on Apr 19, 2019

carlsona147

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Reply #1 on: Apr 19, 2019
Lorsum iprem. Lorsus sur ipci. Lorsem sur iprem. Lorsum sur ipdi, lorsem sur ipci. Lorsum sur iprium, valum sur ipci et, vala sur ipci. Lorsem sur ipci, lorsa sur iprem. Valus sur ipdi. Lorsus sur iprium nunc, valem sur iprium. Valem sur ipdi. Lorsa sur iprium. Lorsum sur iprium. Valem sur ipdi. Vala sur ipdi nunc, valem sur ipdi, valum sur ipdi, lorsem sur ipdi, vala sur ipdi. Valem sur iprem nunc, lorsa sur iprium. Valum sur ipdi et, lorsus sur ipci. Valem sur iprem. Valem sur ipci. Lorsa sur iprium. Lorsem sur ipci, valus sur iprem. Lorsem sur iprem nunc, valus sur iprium.
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big1devin

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Reply #2 on: Apr 19, 2019
Thanks


carlsona147

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Reply #3 on: Apr 19, 2019
Welcome :)


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