Answer:
(a)
TC(q) [before expansion] = Fixed Cost + Variable Cost
= 750,000 + 1.25q
TC(q) [after expansion] = (750,000 + 350,000) + 0.75q
= 1,100,000 + 0.75q
(b) (i) q = 600,000
TC(q) [before expansion] = 750,000 + (1.25 × 600,000)
= 750,000 + 750,000
= 1,500,000
TC(q) [after expansion] = 1,100,000 + (0.75 × 600,000)
= 1,100,000 + 450,000
= 1,550,000
Since expansion will increase total cost, profit will fall ceteris paribus. So firm should not expand.
(ii) q = 800,000
TC(q) [before expansion] = 750,000 + 1.25 × 800,000
= 750,000 + 1,000,000
= 1,750,000
TC(q) [after expansion] = 1,100,000 + (0.75 × 800,000)
= 1,100,000 + 600,000
= 1,700,000
Since expansion will decrease total cost, profit will rise ceteris paribus. So firm should expand.
The answer to the question is "Customer- Oriented".
<span>Julia's is an upscale women's clothing store. prices are based on customers' beliefs about the value of the clothing. the store focuses on a limited target market and provides excellent customer service.Julia's is using a CUSTOMER ORIENTED pricing strategy.</span>
Answer: The answer has been attached.
Explanation:
The journal is an accounting book that is used to record the transactions that take place in a business.
The entry to retire the bonds have been recorded. It should be noted that the bonds payable and the premium on
the bonds payable are debited while
the gain on the retirement of bonds and cash was credited.
Kindly, check attached file.
Answer:
The correct words for the blank spaces are: lowering; more.
Explanation:
In case firms have an excess of supply, they will rather sell their products at a lower price than keeping them stored for loss. According to the supply and demand theory, <em>if the prices decrease, so will the quantity supplied but the quantity demanded will rise</em>.
Answer:
d. both the income and substitution effects encourage the consumer to purchase less of the good.
Explanation:
The income effect is the effect on the income when there are price changes. When the price increases, people can buy less products with the same income which means that the consumer will be encouraged to purchase less goods.
The substitution effect says that an increase in the price of a product will make customers to buy other similar products which will make them to purchase less of the good with the higher price.
