1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Marizza181 [45]
3 years ago
10

"Mrs. Smith operates a business in a competitive market. The current market price is $8.10. At her profit-maximizing level of pr

oduction, the average variable cost is $8.00, and the average total cost is $8.25. Mrs. Smith should"
Business
2 answers:
STALIN [3.7K]3 years ago
8 0

Answer:

Mrs.Smith should continue to operate the business in the short run but shut down in the long run.

Explanation:

According to the shut down rule, at the profit-maximizing positive level of output, a business in a competitive market should continue to operate in the short-term if the price equals to or is greater than the average variable cost, but should shut down in the long term if the price is less than or equal to total cost. Here,

price = $8.10

avg variable cost = $8.00

avg total cost = $8.25

Mrs.Smith should continue to operate the business in the short run but shut down in the long run.

algol133 years ago
4 0

Answer:

Short-run continue to operate Long turn. decreases cost or leave the market

Explanation:

Mrs Smith will shut-down the business if it cannot cover their variable cost given the current selling price ( This means, given Mr Smith cost structure it cost more to produce it that than to purchased it)

gross profit ( check if profitable in the long-run)

sales price $8.10 - $8.25 total variable cost= -0.15 producing a unit in the current cost structe generates losses for 15 cent in the bottom line

contibution ratio (check for wheather the product is profitable or not in the short run)

sales price $ 8.10 - $ 8.00 variable cost = $0.10 contribution

As the product generates a contribution their volume makes the bottom of the line better If we don't produce it we are going to decrease our losses even more.

<em><u>We have to produce and improve our situation by some of these measurements:</u></em>

  • decrease our variable cost (anytime)
  • decrease our fixed cost (in the long turn as currently are fixed)
  • increase selling price if possible

You might be interested in
Langer Company produces plastic items, including plastic housings for humidifiers. Each housing requires about 15 ounces of plas
Alex

Answer:

Langer Company

Direct Materials Purchases Budget

For July, August and September

                                                             July August September Total

Units to be produced                        3500 4400 4900 12800

Direct materials per unit (ounces)             15 15 15 15

Production needs                                52500 66000 73500 192000

Desired ending inventory (ounces) 19800 22050 28350 28350

Total needs                                        72300 88050 101850 220350

Less: Beginning inventory                15750 19800 22050 15750

Direct materials to be purchased (ounces) 56550 68250 79800 204600

Cost per ounce                               $0.08 $0.08 $0.08 $0.08

Total purchase cost                     $4,524 $5,460 $6,384 $16,368

3 0
3 years ago
In which phase of the strategic marketing planning process does the firm decide what level of commitment to its ethical policies
jonny [76]

Answer:

The answer is planning

Explanation:

This process involves clarifying the kind of strategic objectives an organization would like to achieve and how this is to be done    

7 0
3 years ago
The detailed plan that shows the exact end items (i.e., finished products) to be produced in a specific time frame is known as w
Nat2105 [25]

Answer:

Master Production Schedule (MPS)

Explanation:

Master production schedules are plans for individual products to be produced. The plans specify the time a specific product is produced, inventory needs, staffing needs, etc. A master production schedule or MPS will quantify raw materials, processes, and other resources needed to optimize production. (optessa.com)

4 0
3 years ago
in 2018, a company employee received an option to purchase the company's stock at $45 per share. if the stock is trading at $40
erma4kov [3.2K]

Based on the stock's price in 2020, the employee will most likely not bother to exercise the options.

<h3>When are options exercised?</h3>

Options are exercised by employees or other parties when the market price of the underlying stock is more than the price that the option can be redeemed at because this would lead to profit.

The underlying stock here is trading at $40 which is less than the price of redeeming the option so the employee will not exercise the options.

Find out more on exercising options at brainly.com/question/25750529

#SPJ1

7 0
1 year ago
Explain in your own words how traffic congestion leads to allocative inefficiency.
vlabodo [156]

Answer:

Wear and tear on vehicles leads to more recurrent replacements and repairs.

Explanation:

Traffic congestion can occur as a result of a lack of road capacity.

The causes of traffic congestion include overpopulation, frequent use of private cars, and inadequate public transport.

Traffic congestion may slow down the growth of metropolitan cities.

It also formulates economic geographies.

Wear and tear on vehicles leads to more recurrent replacements and repairs.

7 0
3 years ago
Other questions:
  • Suppose your principal objective is to maximize the selectivity of monochloroethane production relative to dichloroethane produc
    6·1 answer
  • In the heading of a cover letter, which of the following formats should be used for the date?
    8·1 answer
  • If the price level increased from 200 to 250, then what was the inflation rate?
    12·2 answers
  • May is a stockbroker. Due to May's statements, Nora believes that the price of OK Goods, Inc. (OKGI), a widely traded stock, is
    11·1 answer
  • Compute the Work-in-Process transferred to the finished goods warehouse on April 30 using the following information:
    10·1 answer
  • Accounts receivable are assets on a balance sheet most likely because they represent the?
    6·1 answer
  • I have been working on a Elementary Spanish 1 assignment for about 30 minutes, and I am now stuck. Can you please help me with t
    7·1 answer
  • Which type of educational worker will most likely help students find books outside the classroom to help them write research pap
    11·1 answer
  • You have been working for home-building companies for a number of years. You enjoy construction work, and now you want to start
    8·2 answers
  • Indicate whether it would appear on the statement of cash flows as a(n)? operating activity, investing activity, or financing ac
    15·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!