Answer:
b.it is best to ignore sunk costs and keep the bed & breakfast operating.
Explanation:
The owner of the store will face the mortgage cost wether the bed and breakfast is open or closed therefore it should be ignore in the short-term for the decision wether or not to keep the business open.
The business revenues are 6,000 while their cost 4,000 thie means there is a contribution of 2,000 then we subtract the mortage to get a loss 1,000
If closed the losses will increase to 3,000 asthe mortage expense would not disappear.
We should keep it open and look for ways to either sale or rent the space for a better gain than 2,000
It means you have the potential to fully dedicate your time and interest in a country’s industry/economic life. Being a good economic citizen represents economic contributions and serves as a good role model to others
Marginal revenue is equal to marginal cost.
A perfectly competitive firm will maximize profits (minimize losses) by producing the level of quantity.
The profit maximize firms will occur at a level of quantity where marginal revenue equals to the marginal cost. It can also maximize its profit when its total cost curve intersects curve. Economic profit is the difference between the total revenues and economic costs.
Perfectly competitive firms are called the price taker firm to maintain and maximize profits. It definitely raise the prize for its profit otherwise it losses all its production in terms of sales. It is generally an atomic market condition intensively depending on ideal price.
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Answer:
65,000 units
Explanation:
Let the number of units be sold = x
Operating Income= Sales- Variable cost – Fixed Cost
Operating Income = 40x - 24x - 560,000
Operating Income = 16x - 560,000
Return on Investment = Operating Income / Net Operating Assets
16% = (16x - 560,000 )/ 3,000,000
480,000 = 16x - 560,000
16x = 480,000 + 560,000
16x = 1,040,000
x = 65,000 units
