For the past nine months, Delores has been producing frozen yogurt out of her small kitchen shop in Detroit. She's been just breaking even (earning zero economic profit) that entire time. This morning, the state Board of Health informed her that they are doubling the annual fee for the food preparation license she operates under, retroactive to the beginning of her operations. Which of the following statements is true?
• In the short run, Delores should increase output; in the long run, she may need to consider exiting the market
• In the short run, Delores should leave output unchanged; in the long run, she may need to consider exiting the market.
• In the short run, Delores should leave the market; in the long run, she may want to return to the market
• In the short run, Delores should decrease output; in the long run, she may need to consider exiting the market
Answers (1)
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “For the past nine months, Delores has been producing frozen yogurt out of her small kitchen shop in Detroit. She's been just breaking even ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers
You Might be Interested in
An accelerated depreciation method: A) Recognizes more depreciation expense in the early years of an asset's useful life and less in the later years. B) Results in reporting higher earnings every year.
Answers (1)
Wozniacki and Wilcox form Jewel LLC, with Wozniacki receiving a one-half interest in the capital and Wilcox receiving a one-half interest in the capital of the LLC. (Ignore any profits interest for this problem.
Answers (1)
g On January 1, our company purchased a truck for $95,000. The estimated useful life of the truck is 5 years. The residual value at the end of 5 years is estimated to be $15,000.
Answers (1)
On August 1, Masters Company buys 2000 shares of ABD common stock for $72500 cash. On December 1, the stock investments are sold for $75000 in cash.
Answers (1)
The General Fund of the City of Snake River operates on a calendar year basis. It sends bills to property owners on January 2. Taxes are due March 1, but taxpayers are allowed until March 31 to make payment without penalty.
Answers (1)
New Questions in Business
At the beginning of the year, Sigma Company's balance sheet reported Total Assets of $195,000 and Total Liabilities of $75,000. During the year, the company reported total revenues of $226,000 and expenses of $175,000.
Answers (1)
Company X failed to record (accrue) $5,000,000 of vendor invoices and warranty liability at year-end. With this omission, the company's summary financial statements were stated as follows:Summarized Income StatementSales $50,000,000All Cost (incl.
Answers (1)
Levine Company uses the perpetual inventory system. Apr. 8 Sold merchandise for $8,600 (that had cost $6,355) and accepted the customer's Suntrust Bank Card. Suntrust charges a 4% fee.
Answers (1)
G. R. Edwin Inc. had sales of $6.02 million during the past year. The cost of goods sold amounted to $3.06 million. Operating expenses totaled $2.65 million, and interest expense was $27 comma 000.
Answers (1)
During the year, Calabash Clinic made a $50,000 cash payment toward its bank loan, which it had previously recorded; $40,000 was for principal, and $10,000 was to pay the full amount of interest due.
Answers (1)