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Author Question: A firm produces three products. Product A sells for $60; its variable costs are $20. Product B sells ... (Read 167 times)

MirandaLo

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Question 1

Health Care Systems of the South is about to buy an expensive piece of diagnostic equipment. The company estimates that it will generate uniform revenues of $500,000 for each of the next eight years. What is the present value of this stream of earnings, at an interest rate of 6%? What is the present value if the machine lasts only six years, not eight? If the equipment cost $2,750,000, should the company purchase it?

Question 2

A firm produces three products. Product A sells for $60; its variable costs are $20. Product B sells for $200; its variable costs are $120. Product C sells for $25; its variable costs are $10. Last year, the firm sold 1000 units of A, 2000 units of B, and 10,000 units of C. The firm has fixed costs of $320,000 per year. Calculate the break-even point of the firm.


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Marked as best answer by MirandaLo on Dec 3, 2019

briseldagonzales

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MirandaLo

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Reply 2 on: Dec 3, 2019
Thanks for the timely response, appreciate it


aruss1303

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Reply 3 on: Yesterday
Excellent

 

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