Difference between shutting down and going out of business

Assignment Help Business Economics
Reference no: EM13177293

Say you are the manager of a perfectly competitive firm selling a product. Your business is making a loss because total revenue is less than total costs. What would you do--shut down or continue to operate? Use hypothetical numbers to explain. Information you need to provide include--state the product you are selling, the price of the product, the quantity of the product you produce, fixed costs, total cost, figure out total revenue, total and average variable costs. Then go ahead and make your decision. Explain carefully why it makes better sense to shut down rather than continue to operate or to continue to operate rather than shut down, as the case may be. How do fixed costs play a role in your analysis? What is the difference between shutting down and going out of business?

Reference no: EM13177293

Questions Cloud

What restrictions must be placed on the parameters : Solve for the equilibrium values of Q and P (So find Q* and P*) as a function of a1, a2, b1, b2. And what restrictions must be placed on the parameters a1b2 and a2b1 so that the value of Q* above makes economic sense?
Evolution of formal organizations paper : Explain how formal organizations have evolved over the past century. What differences were there in organizations a century ago, compared to today's organizations? What are the current trends in formal organizations?
What was the average market price per share : What was the average market price per share at which common stock was issued, and what was the average market price per share at which preferred stock was issued and what is the total value of the Paid in Capital portion of stockholders equity?
Mass of water sufficient to cover the surface of the earth : Calculate the mass of water sufficient to cover the surface of the Earth with 1" of  liquid. (This is the equivalent amount of water vapor contained in the Earth's  atmosphere at any instant in time).
Difference between shutting down and going out of business : Explain carefully why it makes better sense to shut down rather than continue to operate or to continue to operate rather than shut down, as the case may be. How do fixed costs play a role in your analysis? What is the difference between shutting ..
Find the two mean proportionals between two cubes : Find the two mean proportionals between two cubes guaranteed by Proposition VIII-12.
Class is economics of healthcare : Class is Economics of Healthcare. Discussion question, no word minimum. The evolution of managed care organizations and consumer driven health plans has affected the healthcare environment today by integrating the financing and delivery of healthcare..
Explain wto and gatt : Which of the following situations will arise in the domestic market following the removal of an import quota? a. imports increase, domestic production increases, prices increase b. imports increase, domestic production decreases, prices decrease c. i..
Find the bearing of the plane : A plane is heading due south with an airspeed of 237 mph. A wind from a direction of 50 degrees is blowing at 12 mph. Find the bearing of the plane.

Reviews

Write a Review

 

Business Economics Questions & Answers

  Why do years bonds issued by the us government have lower

Why do 20-years bonds issued by the US government have lower rates of return than 20-year bonds issued by corporations?

  Show the effects of the fed contractionary monetary policy

Show the effects of the Fed's contractionary monetary policy by shifting one or both of the curves.

  Explain that jenny is consumer in the antique car market

Suppose that Jenny is the only consumer in the antique car market. Her willingness to pay for an antique car is $200,000. Based on Jenny's willingness to pay, plot her demand schedule in the graph below using the blue points (circle symbol). Line ..

  A central bank that adopts a fixed exchange

A central bank that adopts a fixed exchange rate system may sacrifice its monetary autonomy in setting its domestic monetary policy.

  How are people in different countries likely to value effort

Given what you know about the likely effects of climate change, how are people in different countries likely to value efforts to reduce the rate of global warming?

  What level of t must be set to achieve the goal

Suppose the government wants to achieve a level of Y=2,000. What level of T must be set to achieve the goal? Where C=200+0.5(Y-T), I=800, and G=300

  Perform a statistical analysis

Perform a statistical analysis of its short-run production costs to estimate its total variable cost function.

  What will the new lerner index be after some time

What will the new Lerner Index be after some time with the new demand curve and market price of 30? What firms survive the new demand curve in the industry and why?

  What will happen to marketplace for debit-card transaction

What will happen to the marketplace for debit-card transactions and Visa's profits in the long-run. Use graphs to support your analysis and briefly explain your graphs.

  Most important determinants of the demand

Illustrate what are the most important determinants of the demand function that a firm faces for the commodity it sells.

  Consumption function in terms of her annual income

Derive Chenyu's consumption function in terms of her annual income Y and initial wealth W according to the life-cycle model.

  Illustrate how increase in human capital affects production

Illustrate how increase in human capital affects production function. Blue line (circle symbols) in graph below shows production function.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd