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4 years ago

When price is less than average variable cost at the profit-maximizing level of output, a firm should ________.

Business

1 answer:

bagirrra123 [75]4 years ago

4 0

Answer:

.B) shutdown, because it cannot even cover all of its variable costs let alone its fixed costs if it stays in business.

Explanation:

In a competitive market, the firm maximize it's profit when the market price of the firm is equal to average variable cost of the firm so that the firm earns normal profits in the long run.

Therefore, if price is less than the average variable cost then the firm should shutdown because it cannot even cover all of its variable costs let alone its fixed costs if it stays in business.

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4. Sara is the chief financial officer (CFO) of a large private corporation that is planning a major expansion. She is preparing

blagie [28]

Answer: Investment Banker

Explanation:

Investment bankers are the go to entities in the financial.world when one wants to embark on an IPO.

They play a very good role of Underwriter as they have an expertise in this market. The process works by the Investment bank giving advice to the company in question, researching and marketing information on the shares to be sold, and follow up advising afterwards.

As an underwriter, Investment banks sometimes buy up all the shares at a lower rate and then resell it, this ensures that all of the company's shares are sold.

3 0

4 years ago

Assume that as your income increases, your consumption of burgers decreases. We can assume that your income elasticity of demand

hodyreva [135]

Answer: Option (d) is correct.

Explanation:

Here, Income elasticity of demand for burger is negative because burger is considered as inferior good for this person. There is a inverse relationship between the income of an individual and demand for a inferior good which means that as the income of a consumer increases, as a result demand for inferior good decreases whereas demand for normal good increases with increased income level. Income elasticity of demand for normal good is positive.

6 0

4 years ago

The process of checking products to make sure they meet a company's standards is known as

disa [49]

Usually this is known as quality control

4 0

3 years ago

A company's value-creating activities can offer a competitive advantage in one of these ways. a. contribute to greater efficienc

natali 33 [55]

A company's value-creating activities can offer a competitive advantage by contributing to greater efficiency and lower costs and provide a basis for differentiation.

<h3>What is differentiation?</h3>

This is a process whereby organizations ensure that their product are recognized in the market space. The aim is to distinguish a company's product from competitors.

Hence, a company's value-creating activities can offer a competitive advantage by contributing to greater efficiency and lower costs and provide a basis for differentiation.

Learn more about differentiation here: brainly.com/question/26683215

#SPJ12

6 0

2 years ago

A supplier offers a company terms 3/10, n/30 for a $10,000 purchase on account on January 1. The company uses a perpetual invent

Sedbober [7]

Answer:

The entry to record the payment:

Debit Accounts Payable $10,000

Credit Purchase discount $300

Credit Cash $9,700

Explanation:

Credit terms of 3/10, n/30 means that 3% discount for the payment within 10 days and the full amount to be paid within 30 days.

On January 1, the company purchase inventory:

Debit Inventory $10,000

Credit Accounts Payable $10,000

The company makes the payment on January 10 and takes the appropriate discount:

3% x $10,000 = $300

The entry to record the payment:

Debit Accounts Payable $10,000

Credit Purchase discount $300

Credit Cash $9,700

8 0

4 years ago