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Business, 21.08.2020 01:01, 911wgarcia
The wage rate for all units of labor is $10/hr. You have spent $160,000 on developing a production process (Process X) that will allow you to produce 8 units for every unit of labor. If you use this production process, the accounting profits will cover the initial investment within 6 months. If you use your normal production process (not Process X), you can produce 10 units for every unit of labor. Both processes are fully scalable, so the marginal product of labor is fixed for any reasonable amount of labor you could hire. Based on this information, what should you do?
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The wage rate for all units of labor is $10/hr. You have spent $160,000 on developing a production p...
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