Suppose the Cost of Operating a 100 Room Hotel for a Night

question 75

Multiple Choice

Suppose the cost of operating a 100 room hotel for a night is $10,000 and there are 5 empty rooms for tonight.If the marginal cost of operating one room for one night is $30 and a customer is willing to pay $60 for the night,the hotel manager should

• A)rent the room because the marginal benefit exceeds the marginal cost.
• B)rent the room because the marginal benefit exceeds the average cost.
• C)not rent the room because the marginal benefit is less than the marginal cost.
• D)not rent the room because the marginal benefit is less than the average cost.

Identify and compare counterconditioning techniques.

Appreciate the eclectic approach in psychotherapy for its adaptability and incorporation of multiple therapeutic perspectives.

Understand the concept of price elasticity of demand and its calculation methods.

Analyze the effects of price changes on the quantity demanded and total revenue.

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Definitions:

Accelerated Depreciation

Any method that shifts depreciation forward in an asset’s life. Accelerated methods increase early charges and reduce those that come later, keeping total depreciation constant.

Tax Accounting

A method of accounting that focuses on taxes rather than the appearance of public financial statements.

Deferred Tax Liability

Deferred Tax Liability is a tax that is assessed or is due for the current period but has not yet been paid, often resulting from timing differences between book and tax deductions.

Economic Depreciation

A decrease in the value of an asset due to changes in market conditions or technology, as opposed to physical wear and tear.