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Assume that owning and operating a certain machine to till 850 acres results in an ownership cost of $5,000 per year plus operating costs of $5.00...

1.   Assume that owning and operating a certain machine to till 850 acres results in an ownership cost of $5,000 per year plus operating costs of $5.00 per acre including labor. Leasing a machine with a field capacity of 5.0 acres per hour to do the same work would cost $40 per hour, plus the same operating costs. Hiring the work done on a custom basis would cost $12 per acre. Which alternative has the lowest total cost?

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lowest total cost... View the full answer

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Ownership costs = $5 , 000 Operating costs = $5 . 00 * 850 = $4 , 250 Total costs ownership costs = $5 , 000 +... View the full answer

Ownership cost = 5000. Since the acres owned is 850, (850*5/acre) = 4250 dollars Hence, cost of owning... View the full answer

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