Final answer:
The per-unit cost of producing a good that takes $100 to produce 40 units is $2.50. If technology improves and allows 50 units to be produced for $100, the per-unit cost decreases to $2.00. The business aspect of the question involves cost calculation, technological impact on production, and strategic decision-making.
Step-by-step explanation:
If it takes $100 to produce 40 units of a good, the per-unit cost is $100 ÷ 40, which is $2.50 per unit. If an advance in technology makes it possible to produce 50 units at a cost of $100, then the per-unit cost falls to $100 ÷ 50, which is $2.00 per unit.
The subject of this question seems to be centered around cost calculation and the impact of technological advancements on production efficiency in a business context. It is a typical problem that illustrates how firms can adjust to changes in production costs to maintain profitability.
In the scenarios provided in the examples, we see how changes in the costs of labor and machinery, along with the adoption of different technologies, affect the overall cost of production. The examples show a firm making strategic decisions to utilize various technologies as a response to shifts in wages and machine costs.
If the cost of labor remains at $40, but the cost of a machine decreases to $50, the total cost would be the sum of these amounts for each technology. The firm should use the technology that results in the lowest total production cost, taking into account both fixed costs (like the machine cost) and variable costs (like labor) to determine the most cost-effective method of production.