Which of the Following Machines Has the Lowest User Cost

question 94

Multiple Choice

Which of the following machines has the lowest user cost? Machine A costs $15,000 and depreciates at a rate of 25%,machine B costs $10,000 and depreciates at a rate of 20%,machine C costs $20,000 and depreciates at a rate of 10%,and machine D costs $17,000 and depreciates at a rate of 11%.The expected real interest rate is 0%.

• A)Machine A
• B)Machine B
• C)Machine C
• D)Machine D

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Definitions:

Production Possibility Frontier

A plot that displays the extreme production possibilities for two goods, based on an array of resources and additional factors.

Resources Efficiency

The optimal use of resources to achieve the desired outcome with minimal waste, maximizing the effectiveness of resource utilization.

Technology Improvement

Enhancements or upgrades in technology that increase efficiency, productivity, or quality of outputs.

Production Possibility Frontier

Graphical representation illustrating the maximal output options for two goods, determined by specific resources and other influential factors.