The Law of Supply states that, in most cases, the quantity supplied of a good ___________ when the price of the good rises. T
his means we would expect a typical supply curve to be___________.
1 answer:
Answer:
Rises
Upward sloping
Explanation:
The law of supply states that the higher the price, the higher the quantity supplied and the lower the price, the lower the quantity supplied.
If the price of a good or service rises, suppliers would increase quantity supplied in order to earn higher profits and when prices fall, suppliers would reduce quantity supplied in order to minimise losses.
The supply curve is upward sloping.
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Answer:
b. 18,602 units.
Explanation:
First, we need to use last year's information to determine last year's fixed costs.
Price (P1) = $7.68
Variable costs (VC1) = $2.25
Units sold to break-even (n1) = 21,800
At the break-even point, net income is zero and the fixed cost can be found by:
With information from last, information for the current year can be determined:
Price (P2) = $10.00
Variable costs (VC2) = $2.25 x 1.3333 = $3.00
Fixed cost (FC2) = $118,374 x 1.10 = $130,211.4
The number of units required to break even is:
Rounding up to the nearest whole unit, Dorcan Corporation must sell 18,602 units to break-even.