Wanda Weeks Is Tired of Running Her Small Machine Tool

question 30

Essay

Wanda Weeks is tired of running her small machine tool company.She wishes to sell it in order to use her time and money elsewhere.She is currently earning a salary of $85,000 per year and a 10 percent return on her capital investment.She wants to take a job in a bank and invest her capital in a mutual fund.What issues should she look at before making the decision to change careers?

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Definitions:

Production Decision

The process of deciding on the quantity of goods or services to produce, based on various economic factors.

Short-run

A period in which at least one factor of production is fixed, limiting the ability to adjust to changes in market conditions.

Perfectly Competitive Industries

Markets where there are many buyers and sellers, products are homogeneous, and no single entity has the ability to influence prices.

Quantity Of Output

The total amount of goods or services produced by an individual, firm, industry, or entire economy in a given period.