If a firm's current revenues are less than its current variable costs, when should it shut down?
Question:
If a firm's current revenues are less than its current variable costs, when should it shut down? If it decides to shut down, should we expect that decision to be final? Explain using an example that is not in the book.
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 69% (13 reviews)
The firm should shut down immediately If the firm were to conti...View the full answer
Answered By
PALASH JHANWAR
I am a Chartered Accountant with AIR 45 in CA - IPCC. I am a Merit Holder ( B.Com ). The following is my educational details.
PLEASE ACCESS MY RESUME FROM THE FOLLOWING LINK: https://drive.google.com/file/d/1hYR1uch-ff6MRC_cDB07K6VqY9kQ3SFL/view?usp=sharing
3.80+
3+ Reviews
10+ Question Solved
Related Book For
Microeconomics Principles, Problems and Policies
ISBN: 978-1259450242
20th edition
Authors: Campbell R. McConnell, Stanley L. Brue, Sean Masaki Flynn
Question Posted:
Students also viewed these Business questions
-
Ethics and quality. Information from a quality report for 2009 prepared by Lindsey Williams, assistant controller of Citocell, a manufacturer of electric motors, is as follows: Davey Evans, the plant...
-
Multiple Choice Questions 1. Which of the following is not included in the definition of accounting? a. Identifying economic information b. Measuring economic information c. Developing economic...
-
If a monopoly is losing money then when should it shut down?
-
A hospital radiology department has the following activities: Activity Number Activity Description 1 Repair X-ray equipment 2 Taking X-ray with X-ray...
-
You will create a paper that includes the following: Definitions and detailed analysis on how that organization applies the lessons learned in the course, including the following concepts: o...
-
Suppose you invest $500 in a bank that pays 5.5% annual interest compounded quarterly. a. How much money will you have after five years? b. Suppose you also deposit an additional $150 at the end of...
-
Keynes Company sells both radios and cassette players at the following per unit data: What is the number of radios and cassette players that Keynes must sell in order to break even if fixed costs are...
-
Student Premier Painters (SPP) has six house painting jobs in a particular neighborhood. The houses vary in size, condition, and painting requirements, but each house must be prepped (cleaned,...
-
Required information [The following information applies to the questions displayed below.] On December 1, Jasmin Ernst organized Ernst Consulting. On December 3, the owner contributed $84,310 in...
-
There are 2 shinobis with chakra levels 5 and 10 respectively and the desired sum of chakra levels is utmost 15 Starting with ke0, suy of chakra levels after attack max(5-0,0) + max(10- 0,0) 5+10 15....
-
That segment of a competitive firms marginal-cost curve that lies above its average-variable-cost curve constitutes the short-run supply curve for the firm. Explain using a graph and words.
-
Suppose that the paper clip industry is perfectly competitive. Also assume that the market price for paper clips is 2 cents per paper clip. The demand curve faced by each firm in the industry is: a....
-
Go to the Information Overload Research Groups website (iorgforum.org). Read a research article, blog entry, or other content about a topic of interest. In three to five paragraphs, explain the...
-
You are borrowing $21,000 with no money down to buy a car. The terms of the loan call for equal monthly payments for 5 years at 4.25% annual interest. What is the amount of each monthly payment?
-
A company wants to buy a lease for a mine that has four more years of productive life. It estimates that the returns will be $2095 at the end of the first year, $48813 at the end of both second and...
-
Suppose that an asset price is $37.3 and that its daily volatility is 9.2%.If we assume that the change in the asst price is normally distributed, we can be 99% (z=2.33) certain that the asset price...
-
5)-Three years ago you purchased a 9% coupon bond that pays semiannual coupon payments for $960. What would be your bond equivalent yield if you sold the bond for current market price of $1,051? Your...
-
MZ Corporation produces fudge bars. Total fixed cost is $55,500. Each package of fudge bars sells for $4.95 with a variable unit cost of $3.10. What is the breakeven point for MZ Corporation? Fudge...
-
Estimate the group efficiency of a 4 6 pile group, consisting of 400 mm diameter concrete piles at 1.2 m center-tocenter spacing using a. The converse-labarre equation b. The los angeles group...
-
Suppose that the laptop of Prob. 2.16 is placed in an insulating briefcase with a fully charged battery, but it does not go into sleep mode, and the battery discharges as if the laptop were in use....
-
The centrepiece of the 2014 G20 meeting is for all 20 countries to boost investment, create new jobs, and together boost world income by $2 trillion over 5 years. a. Explain the effect of an increase...
-
The deficit in the first 10 months of the year from April 2013 to January 2014 totalled $10.54 billion, down from $13.87 billion in the same period a year earlier. a. Explain the effect of the...
-
With economic growth forecasted to slow, future incomes are expected to fall. If other things remain the same, how will the demand or supply of loanable funds in India change? At the start of 2008,...
-
P11.34 Overhead variances; journal entries; closing variance accounts: manufacturer LO11.5 Broome Instruments Company manufactures a control valve used in air-conditioning systems. The firm uses a...
-
What are the problems with the ideal CNN model? A. Requirement of a large and labeled image dataset B. Higher computational cost for training deep CNNs C. Lower computational cost for training deep...
-
Pregunta 10 1 pts El ingenio Mujica labora en INHGEOMIN; el contador de la institucin le informa que una mina en explotacin tiene una produccin anual de $600,000 y se calcula que se agotar en cinco...
Study smarter with the SolutionInn App