Article Summary Due to Changing Shopping Habits and Increased Online Sales,Macy's Announced

question 245

Essay

Article Summary
Due to changing shopping habits and increased online sales,Macy's announced it would be closing 35 to 40 underperforming stores in early 2016.The stores represent about 5 percent of its total locations,and the company expects to lose about $300 million in sales,or 1 percent of total sales,from the closures.Over the past five years,Macy's has closed 52 stores and opened 12 new locations,leaving the company 770 stores in 45 states.
-Refer to the Article Summary.Use a graph to illustrate average total cost curves for Macy's before and after closing the 35 to 40 stores.Assume that after closing the stores,Macy's will be producing at minimum average total cost.

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Definitions:

Wages

The compensation paid to employees for their labor, typically quantified as an hourly, daily, or piece-rate basis.

Price Level

A benchmark for assessing the average current prices of a vast variety of goods and services produced within the economy.

Active Policy

A governmental policy that involves direct intervention in the economy, such as adjusting interest rates or spending.

Stimulus Package

A set of government spending policies or tax cuts designed to boost economic activity and stimulate growth during or after a recession.