Within a company is a (micro)economy that is monitored by the accounting procedures. In terms of the accounts, the väriðus departmehts produce costs, SUme ul and some of which are direct costs. This problem shows how an open Leontief model can be used to determine departmental costs. The sales department of an auto dealership charges 10% of its total monthly costs to the service department, and the service department charges 20% of its total monthly costs to the sales department. During a given month, the direct costs are $88,200 for sales and $49,000 for service. Find the total costs (in dollars) of each department. (Round your answers to the nearest whole number.) sales department 88,954 service department 48.246

Within a company is a (micro)economy that is monitored by the accounting procedures. In terms of the accounts, the väriðus departmehts produce costs, SUme ul and some of which are direct costs. This problem shows how an open Leontief model can be used to determine departmental costs. The sales department of an auto dealership charges 10% of its total monthly costs to the service department, and the service department charges 20% of its total monthly costs to the sales department. During a given month, the direct costs are $88,200 for sales and $49,000 for service. Find the total costs (in dollars) of each department. (Round your answers to the nearest whole number.) sales department 88,954 service department 48.246

Managerial Economics: A Problem Solving Approach

5th Edition

ISBN:9781337106665

Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Chapter7: Economies Of Scale And Scope

Section: Chapter Questions

Problem 5MC

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