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atroni [7]
3 years ago
5

The owner of an Italian restaurant has just been notified by her landlord that the monthly lease on the building in which the re

staurant operates will increase by 20 percent at the beginning of the year. Her current prices are competitive with nearby restaurants of similar quality. However, she is now considering raising her prices by 20 percent to offset the increase in her monthly rent.
Would you recommend that she raise prices?

a. Yes - the increase in lease expense is a fixed cost.
b. No - the increase in lease expense is a fixed cost.
c. No - the increase in lease expense is a marginal cost.
d. Yes - the increase in lease expense is a marginal cost.
Business
1 answer:
almond37 [142]3 years ago
6 0

Answer:

b. No - the increase in lease expense is a fixed cost.

Explanation:

If the owner of Italian restaurant increases the prices of its product it will result in low customers as the restaurant is already at the competitive price among its other competitors. If the restaurant raises prices the customers will move to the competitors which are offering same quality product at reduced price. The rent is increased by 20% which is considered as a fixed cost because it does not affect the per unit production and is not associated with the numbers of customers.

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When determining the level of control and independence of an employee or independent contractor, which category covers how the w
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Answer:

A) Behavioural

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A general partner who puts together the administrative organization of the limited partnership and handles the registration of t
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Limited partner.

<h3>What is a Limited partner?</h3>
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<h3>What is Limited Partnership?</h3>
  • Similar to a general partnership, a limited partnership (LP) must have at least one general partner (GP) and at least one limited partner, as opposed to the minimum requirement of two GPs for general partnerships.
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Therefore, the answer is a limited partner.

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2 years ago
Planning is often called the primary management function because​ _____________.
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Planning is often called the primary management function because,

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4 0
3 years ago
assume you take a first and second loan on a commercial property; both are interest-only loans with one financing 60% of the pur
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If you look at the information in the question, you'll notice that the return is less than the cost of borrowing (loan interest rate) (ATIRR). This indicates that there is negative leverage and that the property cannot utilise it.

Positive leverage would be created in the first year if the property was purchased with expected returns equivalent to leverage.

Financial leverage is the process of using borrowed money (debt) to buy assets in the expectation that the income from the new asset or capital gain would outweigh the cost of borrowing. The leverage is summed up in this idea. By using debt (loan money), or leverage, we mean to increase the profits on an investment or project.

Leverage allows investors to increase their market buying power.

Leverage is a tool used by businesses to finance their assets. Rather than issuing stock to raise money, businesses can use debt to finance operations in an effort to boost shareholder value.

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