Economnics Discussion

Economics
Tutor: None Selected Time limit: 1 Day

Jan 20th, 2015

Fixed costs = Rent, Lease/Installment payments for equipment, Utilities

Variable costs = Hourly wages, Food/Beverages 

As demand increases, fixed costs will largely remain the same unless the restaurant needed to expand in order to meet the increased demand. In this case, they might have to pay increased rent and also lease/buy new equipment

Variable costs however, will increase in proportion to the increase in demand, no matter how big or small. The owner will now have to employ more staff to service the increased number of patrons as well as buy more food and beverages to service them


A perfectly competitive firm I have recently purchased something from is a food truck in New York City. There are numerous food trucks in this city and the proprietor of the food truck is aware of the industry he is in, in that he knows any price increases above his marginal cost would greatly decrease his sales as patrons would only have to walk a short distance to another food truck to find a lower price

Jan 21st, 2015

Studypool's Notebank makes it easy to buy and sell old notes, study guides, reviews, etc.
Click to visit
The Notebank
...
Jan 20th, 2015
...
Jan 20th, 2015
Dec 11th, 2016
check_circle
Mark as Final Answer
check_circle
Unmark as Final Answer
check_circle
Final Answer

Secure Information

Content will be erased after question is completed.

check_circle
Final Answer