Answer:
Omega Company
B) Product Y should be produced because it will produce greater total profit.
Explanation:
If only Product X is produced, the total profit it will produced is:
Selling price = $35
Variable Cost = $20
Contribution = $15
Total Contribution = $15 x 75,000/4 = $281,250
If only Product Y is produced, the total profit will be:
Selling price = $25
Variable cost = $15
Contribution = $10
Total Contribution = $10 x 75,000/2 = $375,000
Product Y therefore produces a greater total profit. This is because the fixed cost will remain the same if there are no avoidable elements.
As a result of the demand increasing only slightly compared to the reduction in price, the demand must be <u>inelastic</u>.
<h3>Why is the demand inelastic?</h3><h3 />
The demand is considered to be inelastic if the price elasticity is less than 1.
The price elasticity is:
= (%Change in quantity/% Change in price)
Solving gives:
= 15 / 200 ÷ 0.50 / 3.50
= -0.525
In conclusion, the demand for the shakes is inelastic.
Find out more on inelastic demand at brainly.com/question/1899986.
The correct answer is letter C. Structural unemployment describes the short period of unemployment used for matching job seekers to jobs. This happens when there is no available job that the economy can offer that would match the employees general skills.
