The government recently lowered import barriers on good

Assignment Help Business Economics

Reference no: EM131095915

A recent industry report concluded that the global demand for the good X is expected to increase. Based on the demand projections given in the report Colaba, a firm that produces and sells X, is contemplating hiring more labor to increase production. Maria Williams and Christopher Lockhart, both stock market analysts, are discussing the prospects of the firm. Maria thinks that Colaba is a good stock to buy because she expects their profits to increase. Christopher’s opinion differs. He says that an increase in Colaba’s workforce will only increase the wage bill and reduce its profits. Colaba decided to increase the size of ots workforce by 5 %, expecting profits to increase. However, the firm's profits dipped considerably in the next quarter. Which of the following can best explain this outcome? A. the government recently lowered import barriers on good X. B. Economic indicators suggest that the economy has completely recovered from a recession that hit them two years ago. C.most households in this country have a high propensity to spend and also have high levels of debt. D. good X is manufactured using a labor-intensive method of production.

Reference no: EM131095915

Questions Cloud

Quantity demanded for food has increased or decreased : The University Hall has undergone an extensive remodel that resulted in better premises to purchase and consume food. Students appreciate the remodel and are more likely to spend time at the Hall than before. Food prices after the remodel have increa..

Current level of production profit-maximizing firm : At its current level of production a profit-maximizing firm in a competitive market receives $15 for each unit it produces, and faces an average cost of $10. At the market price of $15, the firm’s marginal cost curve crosses the marginal revenue curv..

Restricted freedoms and abolished the constitution : Which of the following is true of Ferdinand VII after his restoration to the Spanish throne in 1814? A He restricted freedoms and abolished the constitution of 1812 B He attempted to restore the Spanish empire in America, constitutional monarch was h..

The government recently lowered import barriers on good : A recent industry report concluded that the global demand for the good X is expected to increase. Based on the demand projections given in the report Colaba, a firm that produces and sells X, is contemplating hiring more labor to increase production...

Firm would increase quantity of labor : IF marginal product of capital is 4000, and marginal product of labor is 100, if wage rate is $10 and rental price of over is $500, costs do not appear to be minimaized. they are getting more output for each dollar would the Firm would increase quant..

Calculate profit-maximizing equilibrium price and quantity : A market analysis conducted by SUNY Canton suggests the following market demand and marginal revenue relations: Public Demand: PPU = 225 - 0.005QPU and MRPU = 225 - 0.01QPU Student Demand: PST = 150 - 0.01QST and MRST = 150 - 0.02QST Total fixed cost..

Describing the biological-social and psychological : Write a 2-3 page paper describing the biological, social, psychological, and sociocultural contributions to the development of a stress disorder (PTSD or ASD). Your paper should also include a description of the main characteristics of the stress dis..

Define the market power for microsoft in software industry : Microsoft has been a giant in the software industry. Can we define Microsoft as a monopoly? Please explain. In addition, whether the Learner Index works well to define the market power for Microsoft in the software industry? Explain your answer.

User Account

All Pages