Question: Suppose she decides to switch from Stack Pro motions to
Suppose she decides to switch from Stack Pro motions to Stack Promotions, Inc. Why would she do that?
Answer to relevant QuestionsThere are 1,000 shareholders of Stack Promotions, Inc. Suppose you are one of them. Explain why you would prefer to buy shares of the business and not the corporation's bonds. What is the issue of corporate governance? To what extent does it affect shareholders? Explain why economies of scale, constant returns to scale, and diseconomies of scale occur. Plot TFC and TVC and compare the graphs to the TC curve. What relationship do you see? Explain how the Boston Celtics of the NBA can use the MR = MC rule to decide whether to sign a college superstar to a first-year $10 million contract.
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