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Oliga [24]
3 years ago
10

Suppose that the market for haircuts in a community is perfectly competitive and that the market is initially in long-run equili

brium. Subsequently, an increase in population increases the demand for haircuts. In the short run, we expect that the typical firm is likely to begin:Select one:A. incurring an economic loss.B. experiencing neither an economic profit nor an economic loss.C. earning an economic profit.D. experiencing no change in its economic profit.
Business
1 answer:
zloy xaker [14]3 years ago
5 0

Answer:

C) earning an economic profit.

Explanation:

Since the market is in long run equilibrium, the demand = the supply of haircuts, and an increase in the quantity demanded will increase the equilibrium price in the short run, generating economic profits at least until more suppliers enter the market and long run equilibrium is established again. Economic profit doesn't exist when the market is at long run equilibrium.

*Economic profit = accounting profit - implicit costs. So economic profit being $0 in the long run doesn't mean the businesses are not making an accounting profit.

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Lucci Inc. is a retailing firm specializing in high-end merchandise. Each of Lucci's stores uses the retail inventory method by
ludmilkaskok [199]

Answer:

1 Line item description                Cost                Retail

2 Beginning inventory                 40000            360000

3 Purchases                                  1000000        10000000

4 Transportation in                       50000

5 Purchase returns                      -20000          -196000    

6 Net purchases(3+4+5)             1030000        9804000

7 Net additional markups                                    800000    

8 Cost to retail ratio                     1070000       10964000

  component(2+6+7)

9 Net markdowns                                                -500000    

10 Sales                                                                  -9800000    

11 Ending inventory,retail(8+9+10)                       664000

Setup calculation:

Cost to retail ratio = Cost to retail ratio component at cost/Cost to retail ratio component at retail

= 1070000/10964000

= 0.097592

= 9.76%

Ending inventory,cost = Ending inventory,retail*Cost to retail ratio

= 664000*9.76%

= $64806

Cost of goods sold = Sales*Cost to retail ratio

= 9800000*9.76%

= $956480

7 0
2 years ago
Assume there are six companies in a certain industry. Four companies have $10 sales apiece, while two companies have $5 sales ea
antoniya [11.8K]

Answer:

An industry consists of six firms with annual sales of $300, $500, $400, $700, $600, and $600, respectively. a. What is the industry's four firm concentration ratio? b. What is the industry's Herfindahl-Hirschman index? c. Is this industry highly concentrated? Explain.

Explanation:

5 0
2 years ago
What are the three basic questions faced by every economy
Likurg_2 [28]

The three basic questions asked are:

1. What goods and services should be produced?

This is asked because the economy wants to produce what the consumers want or else the resources aren't being used efficiently since resources are scarce.

2. How should we produce them?

This is asked because the producers don't want to spend unnecessary time or money on production, so they must choose wisely what method of production is best for their company and consumers.

3. Who are the consumers?

This is asked because the producers want to make sure that they are targeting the right people with advertising or selling.

Hope this helped!

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5 0
3 years ago
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For Wilton Company, the predetermined overhead rate is 70% of direct labor cost. During the month, $720,000 of factory labor cos
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Answer:

Amount of overhead debited to Work in Process Inventory is $364,000

Explanation:

Direct labor cost = Total labor cost - Indirect labor cost

Direct labor cost = $720,000 - $200,000 = $520,000

Overhead debited to Work in Process Inventory= 70% * Direct labor cost

=70% * $520,000

=$364,000

6 0
3 years ago
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fenix001 [56]
The best answer is 30$ to 100,000$ hope it helps
3 0
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