Question

As an investment into his snow clearing business, Jay made a non-refundable purchase of a snow plow for $1,000. The plow can clear two parking lots per hour, and when Jay uses a shovel he can clear one parking lot per hour. He charges the same price regardless of method. Discouraged by the high cost of the plow, Jay considers going back to his old method of shoveling parking lots. Based on the information given, Jay should Use a shovel.

Answer 1

Answer:

use the snow plow

Explanation:

jay should not consider the cost of the plow in making his decision for how to clear parking lots in the future.As this was a non refundable purchase,this is a sunk Cost that has no effect on jay's current choice.

Answer 2

Answer: use the snow plow

Explanation:

Jay should not consider the cost of the plow in making his decision for how to clear parking lots in the future. As this was a non-refundable purchase, this is a sunk cost that has no effect on Jay’s current choice. He should use only the plow now and in the future, as this is the more efficient way to clear snow.