Grand Tree Doors Does Not Make a Door Until an Order

question 32

Short Answer

Grand Tree Doors does not make a door until an order is received.It promises product delivery within five working days because of the excellent relationship it has established with its suppliers.The partnering relationship that Grand Tree Doors shares with its suppliers and its ability to promptly serve its customers indicate that it has an efficient__________.

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Definitions:

Implicit Costs

These refers to the opportunity costs that are not directly paid or incurred but represent the foregone benefits from using resources in a particular way.

Economic Profit

The difference between total revenue and total costs, including both explicit and implicit costs, indicating the financial success exceeding the opportunity cost of resources.

Accounting Profit

The net income for a company calculated by subtracting total expenses from total revenues according to accounting principles, not including implicit costs.

Short-run Supply Curve

A graphical representation showing the relationship between the price of a good and the quantity supplied over a short period, considering some inputs remain fixed.