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2 years ago

Trout farming is a perfectly competitive industry and all trout farms have the same cost curves.

Business

1 answer:

Diano4ka-milaya [45]2 years ago

4 0

Answer:

(i) The farm can cover its revenue using its total variable cost, therefore the farm will continue producing 200 units

(ii) The farm cannot cover its revenue using its total variable cost, therefore the farm will shut down

(iii) The two relevant points on supply curve will be: (Price = $12 & Quantity = 0) and (Price = $25 & Quantity = 200)

Explanation:

(i)According to given data, When output is 200 but price is $20, this price is equal to ATC, so the farm breaks even. But since this price is higher than AVC of $15, the farm can cover its revenue using its total variable cost, therefore the farm will continue producing 200 units.

(ii) When output is 200 but price is $12, this price is equal to ATC, so the farm makes economic loss. Also, this price is lower than AVC of $15, so the farm cannot cover its revenue using its total variable cost, therefore the farm will shut down.

(iii) The farm's supply curve is the portion of its Marginal cost (MC) curve above the minimum point of AVC. Since price equals MC, the two relevant points on supply curve will be: (Price = $12 & Quantity = 0) and (Price = $25 & Quantity = 200).

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2 years ago

Market economies operate on the principle of supply and demand.

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I think that the stament given above is true, as this principle <span>lets business survive or fail without much interaction from the government.</span>

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five (5) specific forces that are acting as stimulants for change, state and explain them with relevant examples.

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Competition
Nature of the workforce
economy
Policy
Technology

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2 years ago

Suppose you deposited $5,000 in a bank account that pays 5.25% with daily compounding based on a 360-day year. How much would be

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Answer:

$5,175

Explanation:

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where,

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2 years ago

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Final Answer

No it will not be classified on cash flow statement.

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2 years ago