The Minimum Possible Average Total Cost of a Computer Repair

question 42

Multiple Choice

The minimum possible average total cost of a computer repair shop is $40 and the minimum possible average variable cost is $30.If you operate this shop,you will shut it down immediately if the equilibrium price of computer repairs falls below

• A)$40.
• B)$35.
• C)$30.
• D)$20.
• E)$10.

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Definitions:

Speculative Motive

The intention to hold cash or other assets in anticipation of future market fluctuations to gain financial advantages.

Collection Float

The time period between when a check is deposited and when the funds become available in the recipient's account, affecting the cash flow and liquidity.

Float Management

The practice of managing the time between when a check is deposited and when it clears, to optimize the use of funds.

Target Cash Balance

The optimal amount of cash a company seeks to maintain to handle operational and transactional needs efficiently.