Suppose that the market equilibrium price for routine service of a four-cylinder car is $320 and the

Fantastic news! We've Found the answer you've been seeking!

Question:

Suppose that the market equilibrium price for routine service of a four-cylinder car is $320 and the minimum average variable cost of such a service at your local mechanic is $350. What would you advise the owner of this business to do? Explain.

Related Book For answer-question

Microeconomics Theory and Applications

ISBN: 978-1118758878

12th edition

Authors: Edgar K. Browning, Mark A. Zupan

See More Books

Posted Date: Apr 20, 2022 07:39 AM

See More Questions

Suppose that the market for Web search engines can best be characterized as monopolistically competitive. If this is the case, should firms that operate in the market such as Yahoo and Google be...
Suppose that the market for air travel between Chicago and Dallas is served by just two airlines, United and American. An economist has studied this market and has estimated that the demand curves...
The market equilibrium price for coffee beans in Ecuador is $2.75/pound, a price at which growers are unable to make a profit. Due to the lack of profits, many growers have stopped production and the...
The Acme Insurance Company purchased a five-year bond whose interest rate floats with LIBOR. Specifically, the interest rate in a given year is equal to LIBOR plus 200 basis points. At the same time...
What is the basic principle of internal control?
Falcon Day Care was established in 2016 to offer day-care services for adults. Its owners had had long social services careers, but limited experience of running a business. Within 18 months, it was...
Two tests are made of the compressive strength of each of 6 samples of poured concrete. The force required to crumble each of 12 cylindrical specimens, measured in kilograms, is as follows: Test at...
An orchard has a acre of specialty fruit trees and is preparing for summer harvest. Historically, this acre has yielded and average of 1,800 lbs of fruit with a standard deviation of 800 lbs. A...
Describe leadership models that better allow for project and team success. Describe how leadership models can impact a project outcome. Describe how leadership models can impact a project outcome....
The business of "healthcare" is currently focused on: A. Establishing viable revenue through appropriate pricing strategies B. Mitigating financial risk C. Managing cost and increasing value D....
Use the below PERT info to answer the following questions. TIMES (DAYS) IMMEDIATE ACTIVITY PREDECESSORS a m b A 8 15 20 B A 4 7 18 C A 5 7 15 C 4 5 12 E B, D 4 7 11 a. What is the expected project...
What are the differences among an onsite team, a virtual team, a task force, and a committee? What are some of the potential differences in dynamics between people in these different groups?
How do medical billing and coding specialists keep up-to-date with changes in ICD and CPT?
Discuss the various ways in which health care reform has affected and may affect the financial delivery of health care today and into the future.
How is working capital important to the health care organization of today? Why is it different in health care as opposed to other industries?
Explain why budgets are important to all organizations. Expand this discussion by illustrating how different types of budgets are used.
Research effective marketing materials for Allucent Company - https://allucent.io What is effective in the construction industry? What is effective in B2B marketing? What is effective to target...
Charles owns an office building and land that are used in his trade or business. The office building and land were acquired in 1978 for $800,000 and $100,000, respectively. During the current year,...
How does the interest rate serve to equalize the desired rate of saving and the desired rate of investment? Would this function be served if the government placed an upper limit on the interest rate...
Distinguish between efficiency in production and efficiency in output. Can an industry achieve efficiency in production and still produce at an inefficient output level? Explain.
If the price of gasoline is $ 4.00 per gallon and the price elasticity of demand is 0.4, how much will a 10 percent reduction in the quantity placed on the market increase the price? Will total...
In 2022, Mark purchased two separate activities. Information regarding these activities for 2022 and 2023 is as follows: The 2022 losses were suspended losses for that year. During 2023, Mark also...
In 2023, Julie, a single individual, reported the following items of income and deduction: Julie owns 100% and is an active participant in the rental real estate activity. What is her taxable income...
Jerry sprayed all of the landscaping around his business with a pesticide in June 2023. Shortly thereafter, all of the trees and shrubs unaccountably died. The FMV and the adjusted basis of the...

Suppose that the market equilibrium price for routine service of a four-cylinder car is $320 and the

Question:

Expert Answer:

Solution The equilibrium price formula is based on ... View the full answer

Microeconomics Theory and Applications

Students also viewed these economics questions