Instead of Comparing the Total Cost of Kim's Proposed Midtown

question 13

Multiple Choice

Instead of comparing the total cost of Kim's proposed Midtown nail salon to her proposed Uptown nail salon, which of the following methods should be used to make a better comparison?

• A) break-even analysis
• B) center of gravity method
• C) fixed costs
• D) variable costs

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Definitions:

Comparative Advantage

The ability of a country or firm to produce a particular good or service at a lower marginal cost and opportunity cost than its competitors.

Produce More

The act of increasing the output of goods or services, typically in response to higher demand or improved efficiency.

U.S. Economy

The economic system of the United States, characterized by a mixed economy with a high level of output, innovation, and diversity of goods and services.

Mixed Economy

An economic system blending elements of market capitalism with some form of government intervention and public enterprise.