Some basic economics concepts include “opportunity cost” and “marginal cost.” Explain the differences between the two and provide examples of each.
September 3, 2020
JACPR Inc. is a company that operates with two servers. An average of 8 customers per hour arrive from outside at server 1, and an average of 15…
September 3, 2020

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?

KM
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