Transactions Concrete Consulting Co. has the following accounts in its ledger: Cash; Accounts Receivable; Supplies; Office Equip
1 answer:
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<u>Answer:</u>
<em>Rico sporting goods sold 8500 treadmills last year. </em>
<u>Explanation:</u>
If total sales of treadmills were 50,000 then the 3 major companies hold the market share with different rates. The Rico sporting goods market share is 17% which means last year it sold 17% of total sales. Therefore =8500.
Hence, The Rico sporting goods share in the total sales is 8500. Therefore, it can be said that the sales of last year of each company is 37,500 8500 and 4000 respectively.
Answer:
Increase quantity to where AC = MC = D=AR=MR
Explanation:
A perfectly competitive market is where there are many firms in the industry producing homogeneous products. There is ease of entry and exit into and out of the market. They are price takers and earn normal profits in the long-run. In order to maximize profits, a firm in a perfectly competitive industry should produce an the quantity where its average cost is equal to marginal cost when AR = MR = D. In other words, when the AC and MC curves intersect with AR = MR = D curve.
<em><u>Please refer diagram</u></em>
The firm is currently producing at a point where AC > MC at quantity 1000. In order to reach AC = MC, the firm has to increase its quantity to Qe. As it increases quantity, although marginal cost increases, average cost falls because now fixed costs are spread over a larger quantity of output.
At Qe, the three curves intersect and is the point where this firm can maximize its revenue (Price = Pe). At a price higher than this, it would lose customers since there are many others producing the same product and customers can easily shift to another.
