Afirm sells a product in a perfectly competitive market. the marginal cost of the product at the current output level of 1,000 units is $2.50. the minimum possible average variable cost is $2. the market price of the product is $2.50. what should firm do to maximize profits?

Lambert manufacturing has $100,000 to invest in either project a or project b. the following data are available on these projects (ignore income taxes.): project a project b cost of equipment needed now $100,000 $60,000 working capital investment needed now - $40,000 annual cash operating inflows $40,000 $35,000 salvage value of equipment in 6 years $10,000 - both projects will have a useful life of 6 years and the total cost approach to net present value analysis. at the end of 6 years, the working capital investment will be released for use elsewhere. lambert's required rate of return is 14%. the net present value of project b is: