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At the last board meeting a member proposed that the Marshall Lions Club lower its

 At the last board meeting a member proposed that the Marshall Lions Club lower its
                            hamburger price at the Celebrate Marshall Festival.  He argued this would sell more
                            hamburgers for charity.

a.He is wrong.

b.Revenues would decrease.

c.Revenues would rise.

d.Revenues are not what matters.

e.Profits would increase.

2.              The Marshall Lions Club increased the price of hamburgers at their Celebrate Marshall
                            Festival and found that revenues increased.  This is likely because, ceteris paribus,

a.the quality of the hamburgers was different

b.the demand for their hamburgers was inelastic

c.the demand for their hamburgers was elastic

d.the quality of the hamburgers was lower

e.more people came to the festival

3.              The town of Marshall’s Boy Scout Troop 1099 decreased car parking prices at the
                            Celebrate Marshall Festival and found they made higher profits.  This likely occurred
                            because

a.marginal cost was equal to marginal revenue

b.marginal revenue was higher than marginal cost

c.marginal revenue was less than marginal cost

d.demand was inelastic

e.marginal revenue was increasing

4.              The Skandusky Downtown Development Corporation (SDDC), a nonprofit entity, was
                            accused by local taxpayers of being overstaffed and too lavishly accommodated for its
                            purpose of achieving its community development goals.  This accusation is an argument
                            that the SDDC

a.is managed by stakeholders

b.staff is following the MC = MR rule

c.is an example of the Lester-Machlup controversy

d.is engaged in empire building

e.is minimizing community losses

5.              Which of the following is not possible when a firm is maximizing its profits?

a.MC = MR

b.AVC is at its minimum point

c.AFC

d.MC = MR and MC is decreasing

e.MC = MR and MC is increasing

6.              Suppose you were working for Richstone’s bakery and calculating whether the bakery
                            was making a profit, considering the recent increase in rent. You have data for price (P),
                            MR, ATC, MC, AVC, at the quantity of 1,000 breads a day. Among the other
                            relationships you consider is (P – ATC) which measures the firm’s

a.total profit

b.profit per unit of output

c.marginal profit

d.total revenue

e.average variable cost

7.              Suppose you were working for Richstone’s bakery and calculating whether the bakery
                            was making a profit, considering the recent increase in rent. You have data for price (P),
                            MR, ATC, MC, AVC, at the quantity of 1,000 breads a day. The firm’s total profit is
                            calculated by

a.P – AVC

b.P – ATC

c.P – MC

d.(P – ATC)Q

e.TR – TVC

8.              Suppose you were working for Richstone’s bakery and calculating whether the bakery
                            was making a profit, considering the recent increase in rent. You have the following data:
                            P = $20, AVC = $10, AFC = $12, and quantity of birthday cakes produced a day is 20.
                            You conclude that the bakery ends up at the end of the day with a

a.loss of $10

b.profit of $10

c.loss of $20

d.profit of $40

e.loss of $40

9.              Suppose you were working for Richstone’s bakery and calculating whether the bakery
                            was making a profit, considering the recent increase in rent. You have the following data:
                            P = $20, AVC = $10, AFC = $10, and quantity of birthday cakes produced a day is 20.
                            You conclude that the bakery ends up at the end of the day with a

a.loss of $10

b.profit of $10

c.loss of $20

d.no loss, no profit

e.loss of $40

10.              Suppose you were working for Richstone’s bakery and calculating whether the bakery
                            was making a profit, considering the recent increase in rent. You have the following data:
                            P = $20, AVC = $10, AFC = $8 and quantity of birthday cakes produced a day is 20.

a.loss of $10

b.profit of $10

c.profit of $20

d.profit of $40

e.loss of $40

 

Dec 09 2019 View more View Less

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