The government of Nirvana has built a canal costing $27 billion. If opened, it will generate...
The government of Nirvana has built a canal costing $27 billion. If opened, it will generate $3,800,000 a year in benefits and have an annual cost of $4,500,000. Should it be opened? Wouldnt keeping it closed cause the $27 billion to be wasted? Explain.
Homework Answers
The canal should not be opened as the marginal cost is higher than the marginal benefit.
The $27 billion spent on it cannot be recovered and it is a sunk cost. Therefore, that cost should not be considered now in making present decisions. Therefore, the canal should be kept closed.
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The government of Nirvana has built a canal costing $27 billion.
If opened, it will generate...
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Please answer ALL! Thank you Chapter 06 Pre-Built Problems Question 5 (of 7) volue: 10.00 points...
Please answer ALL! Thank you
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if
government has no debt initially but then has annual revenues of
1.5 billion for 10 years and annual expenditures I have one 1.6
billion for 10 years then the government has a?
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Please answer ALL! Thank you
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