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Jobisdone [24]
3 years ago
12

A monopolistically competitive firm is operating in the short run at the optimal level of output and is earning negative economi

c profits. Which expression must be TRUE for this firm?
Business
1 answer:
Darya [45]3 years ago
4 0

Answer:

ATC > P = MR = MC

Explanation:

A monopolistic firm is a price taker, it faces a downward-sloping demand curve.  

If a monopolistic competitive firm is operating in the short run at an optimal level and earning negative economic profits, it means that the price is not able to cover the average total costs.  

If the firm is at the optimal level, the price must be equal to marginal revenue and marginal cost. But the price is not covering costs, so the firm is incurring losses.

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An investor purchases $100 par convertible preferred stock at $80 per share. The preferred stock is convertible into common at $
ollegr [7]

Answer:

100000

Explanation:

4 0
3 years ago
Scenario: Fiscal Policy Consider the economy of Arcadia. Its households spend 75% of increases in their income. There are no tax
nika2105 [10]

Answer:

less than the government spending multiplier

Explanation:

Given :

Percentage spends  by a households for the increase in the income = 75%

So the mpc = 0.75

Potential output = 600 billion arcs

The government multiplier is = $\frac{1}{1-0.75}$

                                                $=\frac{1}{0.25}$

                                                = 4

The tax multiplier is = $\frac{c}{1-c}$

                                 $=\frac{0.75}{0.25}$

                                 = 3

Thus we see that the tax multiplier is less than the government spending multiplier.

7 0
3 years ago
Online reviews have become increasingly important to consumers’ ability to decide to purchase items ranging from household goods
Nesterboy [21]

Answer:

The above statement is TRUE

6 0
2 years ago
Bramble Corp. has two divisions; Sporting Goods and Sports Gear. The sales mix is 65% for Sporting Goods and 35% for Sports Gear
Dima020 [189]

Answer:

The break even in dollars is $23000000

Explanation:

The break even point in dollars is the amount of revenue which produces no profit or no loss and where total revenue equals total cost. The break even in dollars is calculated by dividing the fixed cost by the weighted average contribution margin ratio.

Break even in dollars = Fixed costs / Weighted average contribution margin ratio

Weighted average contribution margin ratio is the contribution margin ratio of each products multiplied by the products weight in the sales mix.

Weighted average contribution margin ratio = Weight in sales mix of Product A * contribution margin ratio of product A + Weight in sales mix of Product B * Contribution margin ratio of Product B

Weighted average contribution margin ratio = 0.65 * 0.3 + 0.35 * 0.5  = 0.37

Break even in dollars = 8510000 / 0.37

Break even in dollars = $23000000

3 0
3 years ago
If the contribution margin ratio is​ 60%, target operating income is​ $50,000, and the sales revenue needed to achieve the targe
muminat

Answer:

The correct answer is $430,000.

Explanation:

According to the scenario, the given data are as follows:

Contribution margin ratio = 60%

Operating income = $50,000

sales revenue = $800,000

So, we can calculate the total fixed expenses by using following formula:

Total fixed expenses = Contribution Margin - Operating income

Where, Contribution margin = Contribution margin ratio × sales

Contribution margin =  .60 × $800,000 = $480,000

So, by putting the value in the formula, we get,

Total fixed expenses = $480,000 - $50,000

= $430,000

6 0
3 years ago
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