-A large multinational shipping company, MGC, Inc. has just
decided to spend €10 million on new storage space in Munich, €45
million on new aircraft, and €5 million on additional acquisition
of kerosene. In addition to these expenses, the company is
producing 5 million parcels at a price of €5 per parcel. Now
suppose that MGC plans to have a tenth of that production in
inventory. Over time, the company’s parcels have met with
increasing demand, but the inventory has only increased by €1
million.
a. What is this firm’s total planned investment?
b. How much did the firm actually invest?
c. What is the difference between actual and planned investment?
Should MGC produce more or fewer parcels? Why?
-A large multinational shipping company, MGC, Inc. has just decided to spend €10 million on new storage space in Munich,
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