Microeconomics: Private and Public Choice (MindTap Course List)
15th Edition
ISBN: 9781285453569
Author: James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher: Cengage Learning
expand_more
expand_more
format_list_bulleted
Question
Chapter 3, Problem 11CQ
To determine
The actions taken by an entrepreneur to earn profit and its effects on the value of resources and the effect of loss associated with a firm.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Why do economists believe that economic profit is the more accurate measure of a business success? Why is economic profit the superior method of determining a business success?
How does a firm decide whether to stay in business if it is earning a loss? Discuss in detail.
I was wondering what the answer to this problem in Krugman´s microeconomics book is:
A benefit maximizer company has an economic loss of 10.000$ per year. Its fixed cost is 15.000$ per year. In the short term, should they keep producing or should the close the business? In the long run, should they stay in business?
And if the company had a fixed cost of 6.000$ per year, should they stay in business in the long and short run?
Thank you!
Chapter 3 Solutions
Microeconomics: Private and Public Choice (MindTap Course List)
Knowledge Booster
Similar questions
- What level of output does a firm produce?arrow_forwardThe correct answer to whether it should be produced is that the firm should produce in the short term if it can either make a profit or a loss less than its total costs. True or falsearrow_forwardMany firms in the United States file for bankruptcy every year, yet they still continue operating. Why would they do this instead of completely shutting down?arrow_forward
- What are the advantages of scale in capitalist competition?arrow_forwardHow does the average cost curve help to show whether a firm is making profits or losses?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_forward
- Why do a firm's profit disappear in the long run?arrow_forwardFamily Mart like inner city grocery stores, sometimes exist even though they do not earn economic profits. How can you explain this? It is clear that businesses operate in the short run, but do they ever operate in the long run? Discuss. What are the different type of costs incurred in the short run and in the long run?arrow_forwardWhy can't firms enter the market in the short-run?arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Microeconomics: Private and Public Choice (MindTa...EconomicsISBN:9781305506893Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. MacphersonPublisher:Cengage Learning
Macroeconomics: Private and Public Choice (MindTa...EconomicsISBN:9781305506756Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. MacphersonPublisher:Cengage Learning
Economics: Private and Public Choice (MindTap Cou...EconomicsISBN:9781305506725Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. MacphersonPublisher:Cengage Learning
Managerial Economics: A Problem Solving ApproachEconomicsISBN:9781337106665Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike ShorPublisher:Cengage Learning
Essentials of Economics (MindTap Course List)EconomicsISBN:9781337091992Author:N. Gregory MankiwPublisher:Cengage Learning
Microeconomics: Private and Public Choice (MindTa...
Economics
ISBN:9781305506893
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:Cengage Learning
Macroeconomics: Private and Public Choice (MindTa...
Economics
ISBN:9781305506756
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:Cengage Learning
Economics: Private and Public Choice (MindTap Cou...
Economics
ISBN:9781305506725
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:Cengage Learning
Managerial Economics: A Problem Solving Approach
Economics
ISBN:9781337106665
Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:Cengage Learning
Essentials of Economics (MindTap Course List)
Economics
ISBN:9781337091992
Author:N. Gregory Mankiw
Publisher:Cengage Learning