10. Quick Change and Fast Change are competing oil change businesses. Both companies have 5,000 customers....
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
10. Quick Change and Fast Change are competing oil change businesses. Both companies have 5,000 customers. The price of an oil change at both companies is $20. Quick Change pays its employees on a salary basis, and its salary expense is $40,000. Fast Change pays its employees $8 per customer served. Suppose Quick Change is able to lure 1,000 kustomers from Fast Change by lowering its price to $18 per vehicle. Thus, Quick Change will have 6,000 customers and Fast Change will have only 4,000 customers. Select the correct statement from the following. A Quick Change's profit will increase while Fast Change's profit will fall. B. Fast Change's profit will fall but it will still earm a higher profit than Quick Change. C. Profits will decline for both Quick Change and Fast Change. D. Quick Change's profit will remain the same while Fast Change's profit will decrease. 10. Quick Change and Fast Change are competing oil change businesses. Both companies have 5,000 customers. The price of an oil change at both companies is $20. Quick Change pays its employees on a salary basis, and its salary expense is $40,000. Fast Change pays its employees $8 per customer served. Suppose Quick Change is able to lure 1,000 kustomers from Fast Change by lowering its price to $18 per vehicle. Thus, Quick Change will have 6,000 customers and Fast Change will have only 4,000 customers. Select the correct statement from the following. A Quick Change's profit will increase while Fast Change's profit will fall. B. Fast Change's profit will fall but it will still earm a higher profit than Quick Change. C. Profits will decline for both Quick Change and Fast Change. D. Quick Change's profit will remain the same while Fast Change's profit will decrease.
Expert Answer:
Answer rating: 100% (QA)
Fast change profits when customers are 5000 5000 X 20 8 60000 Fast chang... View the full answer
Related Book For
Posted Date:
Students also viewed these accounting questions
-
The price of an item in consecutive months has been 106, 108, 111, 112, 118, 125, 130 and 132. Use an index based on the first month to describe these changes. How would this compare with an index...
-
The price of an at-the-money European call futures option always equals the price of a similar at-the-money European put futures option. Explain why this statement is true.
-
The chapter states that "when the price of an inferior good falls, the income effect and substitution effect work in opposite directions." Explain what this statement means.
-
A particle of mass m moves in a certain plane P due to a force F whose magnitude is constant and whose vector rotates in that plane with a constant angular velocity . Assuming the particle to be...
-
When someone is sick, the patients decision to take an antibiotic imposes costs on othersit helps bacteria evolve resistance faster. But it also gives free benefits to others: It may slow down the...
-
Warf Computers, Inc., was founded 15 years ago by Nick Warf, a computer programmer. The small initial investment to start the company was made by Nick and his friends. Over the years, this same group...
-
The W1019 structural A992 steel column is assumed to be pinned at its top and bottom. Determine the largest eccentric load \(P\) that can be applied using Eq. \(13-30\) and the AISC equations of Sec....
-
Several private and public sector organizations are associated with the profession. Listed below are activities pertaining to these organizations. 1. License individuals to practice as CPAs. 2....
-
Instructions: Apply IPAC (Issue, principle, application and conclusion) for each member mentioned in the problem question and advise Alan whether he will be able to get vacant possession of the...
-
Was it absolutely necessary to "throw out" the Articles of Confederation and replace our country's constitution with the United States Constitution (USC)? Was it right to adopt the United States...
-
Various attempts have been made to reduce the accounting diversity that exists internationally. This process is known as convergence and is discussed in more detail in Chapter 3. The ultimate form of...
-
Find the limit. == Let lim f(x) =4 and lim g(x) = -6. Find lim [f(x) - g(x)]. x-9 x-9 x-9
-
How does bioinformatics play a pivotal role in the analysis and interpretation of complex biological data sets, and what advancements are needed to enhance the accuracy and efficiency of...
-
In the context of cancer treatment, how are chimeric antigen receptor (CAR) T-cell therapies developed, and what are the risks of off-target effects or cytokine release syndrome with these...
-
Describe the process of RNA interference (RNAi) and its application in therapeutic development. How does RNAi differ from other gene silencing methods, and what are the primary challenges in...
-
An investment plan pays 15% per year, compounded annually. How much would have to be invested every year so that $40 000 will be accumulated by the end of 10 years? above Repeat Problem for an...
-
Robert Corporation purchased a new machine for its assembly line on July 1 , 2 0 0 0 . The purchase price of the machine was $ 1 0 0 , 0 0 0 . Robert spent $ 1 0 , 0 0 0 to transport the machine to...
-
Havel says the grocer doesnt believe what is on the sign and indeed, he says the grocers customers will barely notice it. But Havel maintains that the sign serves a specific function. How would you...
-
What are the values of (a) x1/2 x1/4, (b) (x1/3)3, (c) 90.5, (d) 42.5, (e) 73.2, (f) 41.5 63.7 / 61.7?
-
How would the results for Problem 18.1 change if the part could be supplied only at a fixed rate of 10 units a week? Would there be any benefit in reducing production to 5 units a week?
-
Describe the operating characteristics of a single-server queue with random arrivals at an average rate of 100 an hour and random service times at an average rate of 120 an hour.
-
In a vapour compression refrigeration system, the condition of refrigerant before entering the compressor is (a) saturated liquid (b) wet vapour (c) dry saturated liquid (d) superheated vapour
-
The highest temperature during the cycle in vapour compression refrigeration system occurs after (a) compression (b) condensation (c) expansion (d) evaporation
-
During a refrigeration cycle, heat is rejected by the refrigerant in (a) compressor (b) condenser (c) evaporator (d) expansion valve
Study smarter with the SolutionInn App