A delivery company is considering adding another vehicle to its delivery fleet; each vehicle is rented for $350 per day. Assume that the additional vehicle would be capable of delivering 1,750 packages per day and that each package that is delivered brings in $0.35 in revenue. Also assume that adding the delivery vehicle would not affect any other costs.
Instructions:
a. What are the MRP and MRC?
Should the firm add this delivery vehicle?
(Click to select)
Yes
No
b. Now suppose that the cost of renting a vehicle doubles to $700 per day. What are the MRP and MRC?
