A delivery company is considering adding another vehicle to its delivery fleet; each vehicle is rented for $300 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 $0.30 in revenue. Also assume that adding the delivery vehicle would not affect any other costs. Instructions: Enter your answers rounded to 2 decimal places. a. What is the MRP? What is the MRC? MRP = $ MRC = $ Should the firm add this delivery vehicle: Yes b. Now suppose that the cost of renting a vehicle doubles to $600 per day. What are the MRP and MRC? MRP = $ MRC = $ Should the firm add a delivery vehicle under these circumstances: No c. Next suppose that the cost of renting a vehicle falls back down to $300 per day but, due to extremely congested freeways, an additional vehicle would only be able to deliver 750 packages per day. What are the MRP and MRC in this situation? MRP = $ MRC = $

ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
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A delivery company is considering adding another vehicle to its delivery fleet; each vehicle is rented for $300 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 $0.30
in revenue. Also assume that adding the delivery vehicle would not affect any other costs.
Instructions: Enter your answers rounded to 2 decimal places.
a. What is the MRP? What is the MRC?
MRP = $
MRC = $
%3D
Should the firm add this delivery vehicle: Yes
b. Now suppose that the cost of renting a vehicle doubles to $600 per day. What are the MRP and MRC?
MRP = $
MRC =
Should the firm add a delivery vehicle under these circumstances: No
c. Next suppose that the cost of renting a vehicle falls back down to $300 per day but, due to extremely congested freeways, an
additional vehicle would only be able to deliver 750 packages per day. What are the MRP and MRC in this situation?
MRP = $
MRC = $
Transcribed Image Text:A delivery company is considering adding another vehicle to its delivery fleet; each vehicle is rented for $300 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 $0.30 in revenue. Also assume that adding the delivery vehicle would not affect any other costs. Instructions: Enter your answers rounded to 2 decimal places. a. What is the MRP? What is the MRC? MRP = $ MRC = $ %3D Should the firm add this delivery vehicle: Yes b. Now suppose that the cost of renting a vehicle doubles to $600 per day. What are the MRP and MRC? MRP = $ MRC = Should the firm add a delivery vehicle under these circumstances: No c. Next suppose that the cost of renting a vehicle falls back down to $300 per day but, due to extremely congested freeways, an additional vehicle would only be able to deliver 750 packages per day. What are the MRP and MRC in this situation? MRP = $ MRC = $
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