EBK ECONOMICS TODAY
18th Edition
ISBN: 9780133920116
Author: Miller
Publisher: YUZU
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Question
Chapter 18, Problem aFCT
To determine
The reasons behind the Hungarian government trimming steps and fees for starting a new firm in the country.
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Why might a firm wish to operate in more than one country?
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- Why wouldn’t a firm just drop any product that isn’t selling inhigh enough volume to reach its break-even point?arrow_forwardMany firms, especially in perfectly competitive markets, file for bankruptcy every year, yet they still continue operating. Why would they do this instead of completely shutting down?arrow_forwardWHY SOME FIRMS MIGHT BE ABLE TO CONTINUE TO MAKE AN ACONOMIC PROFIT IN THE LONG RUN?arrow_forward
- Why should a firm shut down immediately when it can no longer cover their variable.arrow_forwardSmall “Mom and Pop firms,” like inner city grocery stores, sometimes exist even though they do not earn economic profits. How can you explain this?arrow_forwardwhat are the maximum profits this firm can earn?arrow_forward
- Small “Mom and Pop" firms sometimes exist even though they do not earn economic profits. How can you explain this? Think about what all is covered in economic profit?arrow_forwardYour aunt is thinking about opening a hardware store. She estimates that it would cost $500,000 per year to rent the location and buy the stock. In addition, she would have to quit her $50,000 per year job as an accountant. If your aunt thought she could sell $510,000 worth of merchandise in a year, what is your aunt’s accounting profit?arrow_forwardShould the firm shut down in the short-run? Explain in detail why or why not.arrow_forward
- Tim is thinking of opening a garment store. He estimates that it would cost $270000 per year to rent the location and buy the merchandise. In addition, he would have to quit his $63000 per year day job. Tim estimates he can sell $315600 worth of garments in a year. a. What will be the accounting profit and economic profit for Tim? b. If you are an economist, should you suggest opening the store? Why?arrow_forwardTim Marlow, the owner of The Clock Works, wanted to know how many clocks he must sell in order to cover his fixed cost at a given price. Tim knew that he had a fixed cost of $20,000 for equipment, taxes, and a bank loan. He also had a unit variable cost of $20 per clock for labor, materials, and promotional costs. If the price Tim charges for each of his clocks is $40, what is his break-even point quantity?arrow_forwardIf the firm wants to sell 70 units as a block and not individually, what price will the firm charge for the block? Please show your calculations Note: The answer should be typed.arrow_forward
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