Answered: Coldwater Bicycle Company operates its…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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1. Coldwater Bicycle Company operates its factories at capacity and holds a dominant market position in its home country. When it receives a premium priced order from a new customer in another country, it must decide whether to fill that order or continue to supply the full demand in its home market. When it decided not to completely fill the new order, it incurred

Group of answer choices

a. Sunk costs

b. Average costs

c. Opportunity costs

d. Marginal costs

2. What might happen if a car dealership is awarded a bonus by the manufacturer for selling a certain number of its cars monthly, but the dealership is just short of that quota near the end of the month?

Group of answer choices

a. Potential buyers will lose buying power at the dealer

b. It may sell the remaining cars at huge discounts to hit the quota

c. It creates an incentive to sell cars from different manufacturers

d. It would ruin the relationship between dealer and manufacturer

3. If Jackie wanted to determine whether to produce more product in her company, she would do so if

Group of answer choices

a. Marginal revenue exceeded average cost

b. Marginal cost was greater than marginal revenue

c. Average cost exceeded marginal cost

d. Marginal revenue was greater than marginal cost

Thank you!.

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