You consider purchasing a new computing system, including networking, for your sales force for $112,000. The system has a 6-year useful life and no salvage value. Your sales force is expected to generate an additional $37,000 of net income before taxes and depreciation each year by using this upgraded system. The combined federal and state income tax rate = 40%, Annual inflation = 400. A. Fill in the following table assuming MACRS depreciation rates.
Year Pre-Income Depreciation Taxable Tax After tax Inflation Real
Tax income owed income adjustment after tax
factor Income
1 $37,000 $22,400
2 $37,000
3 $37,000
4 $37,000
5 $37,000
6 $37,000
B. Ifyour MARR-15%, should you purchase this system based on your real after-tax income? Why or why not?

Consider the local telephone company, a natural monopoly. the following graph shows the monthly demand curve for phone services and the company’s marginal revenue (mr), marginal cost (mc), and average total cost (atc) curves. 0 2 4 6 8 10 12 14 16 18 20 100 90 80 70 60 50 40 30 20 10 0 price (dollars per subscription) quantity (thousands of subscriptions) d mr mc atc 8, 60 suppose that the government has decided not to regulate this industry, and the firm is free to maximize profits, without constraints. complete the first row of the following table. pricing mechanism short run long-run decision quantity price profit (subscriptions) (dollars per subscription) profit maximization marginal-cost pricing average-cost pricing suppose that the government forces the monopolist to set the price equal to marginal cost. complete the second row of the previous table. suppose that the government forces the monopolist to set the price equal to average total cost. complete the third row of the previous table. under average-cost pricing, the government will raise the price of output whenever a firm’s costs increase, and lower the price whenever a firm’s costs decrease. over time, under the average-cost pricing policy, what will the local telephone company most likely do

Henry crouch's law office has traditionally ordered ink refills 55 units at a time. the firm estimates that carrying cost is 35% of the $11 unit cost and that annual demand is about 240 units per year. the assumptions of the basic eoq model are thought to apply. for what value of ordering cost would its action be optimal? a) for what value of ordering cost would its action be optimal?

In microeconomics, the point at which supply and demand meet is called the blank price