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Question # 1 - Tetrangle Manufacturing has fixed costs of $ 2,160 per day . The firm manufactures bicycle component upgrade kits . The kits have a short-run average variable cost of $ 48 and are sold for $ 66 each .
What is the breakeven level of daily output for the firm ?
What is the degree of operating leverage when the daily output is Q = 170 ?
Question # 5 - As an employer wants to reduce the production cost during the economic recession , he / she could choose to ( 1 ) lay off some workers without changing wages or ( 2 ) keep all workers but cut wages for all . Which method would you choose ? Why ?
Question # 1 - Tetrangle Manufacturing has fixed costs of $ 2,160 per day . The firm manufactures bicycle component upgrade kits . The kits have a short-run average variable cost of $ 48 and are sold for $ 66 each .
What is the breakeven level of daily output for the firm ?
What is the degree of operating leverage when the daily output is Q = 170 ?
Question # 5 - As an employer wants to reduce the production cost during the economic recession , he / she could choose to ( 1 ) lay off some workers without changing wages or ( 2 ) keep all workers but cut wages for all . Which method would you choose ? Why ?