George's Dry Cleaning Is Considering a Merger with Weezzie's Laundry

question 49

Multiple Choice

George's Dry Cleaning is considering a merger with Weezzie's Laundry Supply Stores.George's total operating costs of producing services are $590,000 for sales volume (S_G) of $4.7 million.Weezzie's total operating costs of producing services are $152,000 for a sales volume (S_W) of $2.3 million.For a sales volume of $7 million,calculate the reduction in production costs the merged firms need to experience such that the total average cost (TAC) for the merged firms is equal to 9 percent.

• A)$97,000
• B)$101,000
• C)$112,000
• D)$128,000

Calculate changes in consumer surplus due to shifts in price.

Identify the effects of market equilibrium changes on consumer and producer surplus.

Understand and analyze the relationship between supply, demand, and total surplus.

Interpret the impact of demand and supply shifts on total surplus.

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Definitions:

Self-Actualization

The realization or fulfillment of one's talents and potentialities, considered a drive or need present in everyone.

Predetermined

Something established or decided in advance, not subject to change or influence by subsequent events.

Actualization Tendency

The innate drive in humans towards growth, fulfillment of potential, and self-realization, often associated with the humanistic psychology of Carl Rogers.

Biological Instincts

Innate impulses or drives present in all individuals that guide behavior and ensure survival.