Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

You are managing a factory that is capable of producing a maximum of 100 products per day. If you use overtime labor you can produce

You are managing a factory that is capable of producing a maximum of 100 products per day. If you use overtime labor you can produce up to 150 products per day. Due to equipment maintenance requirements, 150 products per day is the absolute maximum that you can produce. At present , there is a recession - business is slow and you are producing only 80 products per day. Answer and explain thoroughly the below questions. Please Explain with words and graphs:

  1. suppose the sales increase and so does its price. Your employer asks you to increase production from 80 to 100 products. Would the term elastic or inelastic best describe your ability to supply more? Why?
  2. Suppose there is a boom, unemployment is low and the sales and price of your product continue to increase. Your employer ask you to increase production from 100 to 150 per day. How will the elasticity of your S change and why? What are the implication of this change for the price?
  3. Suppose that the sales and the price increase even further, and your employer request production of 180 per day. What has happened to the elasticity of your S and why? What are the implication of this for the p?
  4. What can be done to overcame the problems in part c?

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Business Intelligence

Authors: Jerzy Surma

1st Edition

1606491857, 9781606491850

More Books

Students also viewed these Economics questions

Question

Explain the need for and importance of co-ordination?

Answered: 1 week ago

Question

Explain the contribution of Peter F. Drucker to Management .

Answered: 1 week ago

Question

What is meant by organisational theory ?

Answered: 1 week ago

Question

What is meant by decentralisation of authority ?

Answered: 1 week ago

Question

Wear as little as possible

Answered: 1 week ago

Question

Be relaxed at the hips

Answered: 1 week ago