Suppose the estimated fixed cost of Christmas trees business is $7,000 and not sunk. The estimated variable cost for each tree is $20
According to the forecast, the market price for Christmas trees is $25 each and the owner could sell 1000 trees at most each year. In the long run, the owner A) should shut down.
B) should keep operating.
C) should sell less.
D) None of the above.
A
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Supply-side economics
A) promotes increasing taxes to create additional revenue for government spending. B) promotes expansionary fiscal policy by increasing government spending. C) is based on the Ricardian equivalence theorem. D) promotes reducing taxes to create incentives to increase productivity.
To follow an outward-oriented strategy, a country that has scarce natural resources and abundant labor supplies should _____
a. export primary goods and import manufactured products b. export manufactured goods and impose import restrictions on primary goods c. export both primary and manufactured products d. export primary goods and impose trade restrictions on manufactured goods e. export manufactured products and import primary goods
Which of the following will lead to a movement along the same demand curve?
a. Changes in income. b. Changes in the price of substitute goods. c. Changes in the price of the product. d. Changes in the preference of the consumer.
According to the Taylor Rule, if the inflation rate is 3 percent and the GDP gap is 2 percent, what does the federal funds rate target equal?
A) 8.5 percent B) 5.5 percent C) 3.5 percent D) 6.5 percent