Determine the optimal number of cars, Macroeconomics

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Determine the optimal number of cars

The owner of a rental car company is trying to choose how many cars to buy. He has determined that the annual value of marginal product (P x MPK) of an additional car is approximated by: PxMPK = 5000 - 4xK, where K is the number of cars. A new car costs $20,000 and the interest rate on car loans is 5% per year and the depreciation rate of a car is 15% per year. Determine the optimal number of cars?

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Macroeconomics: Determine the optimal number of cars

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Macroeconomics: Determine the optimal number of cars

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Macroeconomics: Determine the optimal number of cars

Reference No:- TGS0872653

Recent Questions Asked Macroeconomics

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