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serious [3.7K]
2 years ago
13

Suppose a new car company sought to enter the rental car market, and Enterprise, Avis and Hertz responded by offering rentals ve

ry cheaply, at prices below average variable cost, in order to drive the new company out of business. What would be the problem with this plan?
Business
1 answer:
Anni [7]2 years ago
3 0

Answer: The problem of this plan is that their income will not be able to break even, because their cost price will be grater than the selling price. Which may cause the new company to wind up

Explanation: break even is a point where the cost price is equal to the selling price. This means that profit nor loss were not made.

Because Avis and Hertz are offering rentals at a prices below average variable cost, the company may not be able to meet up with capital for production of more cars, and this will cause them to wind up.

For a new company, it is always advisable to keep it's selling price a little bit above or the same with it's cost Price, because the strength not any business is the ability to produce more to fill the space of scarcity.

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Amy and Lester are partners in operating a store. Without consulting Amy, Lester enters into a contract to purchase $10,000 of m
Ivan

Answer:

Amy and Lester are both weird so that's your answer.

Explanation:

none needed

4 0
2 years ago
Which one of the following is not true when the economy is in macroeconomic​ equilibrium? A. When the economy is at​ long-run eq
uranmaximum [27]

Answer:

The correct answer to the following question will be Option C.

Explanation:

  • Throughout the macroeconomic equilibrium, the aggregate supply curve becomes equivalent to something like the supply curve, the real GDP seems to be comparable to potential Output (GDP), however, if frictional as well as systemic unemployment seems to be the maximum total poverty throughout the longer term.
  • Consequently, whenever the economy seems to be in macroeconomic equilibrium, the argument which is not accurate would be that the businesses would have excess power.

So that Option C is the right answer.

6 0
2 years ago
Residents of Mill River have fond memories of ice skating at a local park. An artist has captured the experience in a drawing an
Irina18 [472]

Answer:

the artist should make the elegant version since the expected profits are higher

Explanation:

elegant version:

expected revenue = (400 x $150 x 40%) + (350 x $110 x 60%) = $47,100

expected profits = $47,100 - $30,000 = <u>$17,100</u>

deluxe version:

expected revenue = (500 x $110 x 40%) + (450 x $70 x 60%) = $47,100

expected profits = $42,250 - $30,000 = $12,250

5 0
3 years ago
On may 10, the ceo of massmachine announced a quarterly dividend of $.50 per share to be paid on june 25 to all stockholders on
Serga [27]
It would be on June 3rd. This is the day before the ex-dividend date. The ex-dividend date for stocks is typically set one working day before the record date. If you acquire a stock on its ex-dividend date or after, you will not obtain the next dividend imbursement. As an alternative, the vendor gets the dividend. If you buy earlier than the ex-dividend date, you can get the dividend.
4 0
2 years ago
A growing trend to "Buy American" may encourage U.S. automakers to increase political pressure on Washington to pass legislation
Kazeer [188]

Answer:

C) a positive result from regulatory and economic environmental forces.

Explanation:

In the short run the whole economy will benefit, more American jobs will be created, consumers will probably get good cars at even lower prices, but on the long run the scenario may not be that good for everyone. If Toyota builds the plant, it will be the result of economic and political pressures, and that is a game that two can play, just ask farmers about the trade deal with China.

On the other hand, this is a type of deja vu (or been there, done that), and it ended up with GM and Chrysler bankrupt and Ford barely surviving. This types of policies were enforced in the 1980s by president Reagan and the famous "Made in the USA" by Bruce Springsteen. Back then Honda had a small factory and Toyota was starting to consider building a plant in the US, Nissan hadn't showed up yet. Fast forward a few years and the only good American vehicles are pickups, the Japanese brands wiped out the rest. The country is full of Camrys, Accords, Civics, Corollas, CRVs and Rav4s. They are great cars, too great for the American car manufacturers to compete against. Who knows, with this type of policies maybe in 10 years the only American car manufacturer left will be Tesla.

This is like playing with fire on top of a fuel truck.

5 0
2 years ago
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