Scenario 12.3: Suppose a Stream Is Discovered Whose Water Has Remarkable Healing

question 83

Multiple Choice

Scenario 12.3:
Suppose a stream is discovered whose water has remarkable healing powers. You decide to bottle the liquid and sell it. The market demand curve is linear and is given as follows:
P = 30 - Q
The marginal cost to produce this new drink is $3.
-Refer to Scenario 12.3. What will be the price of this new drink in the long run if the industry is a Cournot duopoly?

• A) $3
• B) $9
• C) $12
• D) $13.50
• E) none of the above

Explain the concept and requirements of a Subchapter S Corporation.

Differentiate among specialized types of corporations: professional, public, and nonprofit.

Understand the components typically found in the articles of incorporation.

Grasp the principal attributes and classifications of corporations.

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Definitions:

Net Income

The total profit or loss of a company after all revenues, expenses, taxes, and dividends have been accounted for.

FIFO

An inventory valuation method that assumes the first items purchased are the first ones sold, standing for "First In, First Out."

Gross Profit

The difference between sales revenue and the cost of goods sold before accounting for other operating expenses.

Physical Inventory

The process of counting and verifying the actual inventory on hand at a business location.