MBA 540 Mid-term exam edited.docx - Name Course Date MBA 540 Mid-term Exam 1 Stella Ann Freeman is having a difficult time deciding whether to purchase

# MBA 540 Mid-term exam edited.docx - Name Course Date MBA...

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Name Course Date MBA 540 Mid-term Exam 1.Stella Ann Freeman is having a difficult time deciding whether to purchase a new car. How would understanding the concept of opportunity costs help her make a decision? 2.Referring to the table below, hiring a driver costs \$10. Each machine costs \$100. Which methods should use and why? - Second Method Fifty drivers each at \$ 10=\$500) + (Two machines each a 100= \$200) = \$700 - Third Method Hundred drivers each at \$10= \$1,000) + (Zero machines each at \$100= \$0) =\$1,000
-Fourth Method Ten drivers each at \$10 = \$100) + (Twelve machines each at \$100 =1,200) = \$1,300 The main utility of the track is to achieve fifty spots within a month through use of the most effective way. In this case, he is keen to let go few drivers to add some machinery in the process. Using the figures in the table, method 2 offers the best approach to handle the issue of transport. There is a difference of \$500 with method one due to the addition of 30 more drivers and 8 fewer machines. Method three is not viable since the main aim is to implement a new strategy. In contrast, method 4 is very expensive and it does not offer an efficient approach to the issue. Plotting the methods in an indifferent curve with all the combination of drivers and machines will alike the same utility. In the second method, result to the maximum utility. In case, there is a decrease in the price of

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