Answer: Option B
Explanation: In simple words, cost cutting refers to the process in which an organisation modifies or re- implement its production and distribution process with the sole object of reducing the cost of production.
By reducing the cost of production an organisation can charge low prices for the product in the market and attract more customers. Although this process sounds straight but it is not easy for the firms orating at small level.
Large firms can easily cut their cost without affecting quality as they have huge scale of operations and they purchase inputs at a high volume which makes them applicable for particular discounts.
Thus, from the above we can conclude that the correct option is B.
Answer:
The Role of the Market. The United States is said to have a mixed economy because privately owned businesses and government both play important roles. When economic forces are unfettered, The Americans believe that the supply and demand determine the prices of goods and services.
Answer:
elastic.
Explanation:
A monopolynis defined as a situation where a single supplier produces a good and so control quantity supplied and price of the product. Monopoly maximises profit when price is elastic and marginal revet is positive. When profit is maximised increase in price from that point does not result in increased profit.
On the other hand when a firm is not maximising profit, it is making profit but can take step to earn more. In this situation increase in price will result in higher profits
Answer:
Increase by 420.000$
Explanation:
Company's annual revenue at this level is: 75.000*440 = 33.000.000$. Total variable expenses are 280*75000= 21.000.000$. Total fixed expenses are 1.020.000$ making its annual profit equal to 10.980.000$. As regular sales won't be affected with the special order, and since company does not uses its entire production capacity, we can treat fixed costs as non-reimbursable costs. Therefore, we only observe relations of variable costs and income.
With price of 340$ per unit, total income is 2.380.000$ and total variable costs are 1.960.000$. The difference is 420.000$ and relates to the increase in profit in terms of non-used total production capacity.
