George Company Has a Relevant Range of 150,000 Units to 400,000

question 175

Multiple Choice

George Company has a relevant range of 150,000 units to 400,000 units. The company has total fixed costs of $525,000. Total fixed and variable costs are $612,500 at a production level of 175,000 units. The variable cost per unit at 300,000 units is

• A)the same as at 175,000 units.
• B)greater than at 175,000 units.
• C)less than at 175,000 units.
• D)dependent upon fixed costs per unit.

Recognize the conditions necessary for long-run equilibrium under perfect competition and the implications for firm entry and exit.

Identify and explain the differences among constant-cost, increasing-cost, and decreasing-cost industries and their impact on market equilibrium.

Understand the effects of taxes and regulations on firm’s production decisions and economic outcomes in the long term.

Assess how producer surplus, economic rents, and economic profits differ and contribute to a firm's financial health.

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Definitions:

Plessy V. Ferguson

A significant 1896 decision by the Supreme Court of the United States that affirmed the legality of racial segregation, as long as the separate facilities were equal.

Supreme Court

The apex judicial authority in the U.S., responsible for interpreting the Constitution and reviewing cases that have significant legal implications nationwide.

Segregation

A policy or practice of separating people of different races, classes, or ethnic groups, especially as a form of discrimination.

Atlanta Riots

Civil disturbances in Atlanta, Georgia, reflecting racial tensions, social, or economic discontent, occurring at various points in the city's history.