Suppose a Firm Producing Aircraft Engines Is Considering the Purchase

question 53

Multiple Choice

Suppose a firm producing aircraft engines is considering the purchase of a robotic assembly machine at a price of $4 million.The firm expects the discounted MRP of the machine to be $1 million over each of the first 3 years,and $0.5 million each in years 4 and 5,after which the machine has no value.This firm should

• A)buy the machine because its present value is more than its purchase price.
• B)be indifferent about the purchase because its present value is equal to its purchase price.
• C)not buy the machine because its present value is less than its purchase price.
• D)not buy the machine because its marginal cost is greater than its marginal revenue.
• E)buy the machine because its marginal cost is less than its marginal revenue.

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Definitions:

Needleless Syringe

A medical device designed to deliver drugs or vaccines through the skin without the use of a traditional needle, reducing the risk of needle-stick injuries and infections.

IV Route

A method of delivering medication or fluids directly into the venous circulation via a needle or catheter.

Pharmacokinetics

The branch of pharmacology concerned with the movement of drugs within the body, including absorption, distribution, metabolism, and excretion.

Absorption

The process by which substances are taken up from the environment and enter the bloodstream or tissues.