Question

A business produces 400 items and sells them for $15 each for a total of $6,000. The total cost of producing the items is $4,500 in explicit cost and $1,000 in implicit cost. Economic profit is: a. $

Answer 1

9-4 Competitive IndustriesRelative to managers in more monopolistic industries, are managers in more competitive industries more likely to spend their time on reducing costs or on pricing strategies?oManagers are more likely to focus on pricing strategies. Since the monopolization is dependent on price elasticity and other market factors, it is important that managers price their product correctly during the monopolization to reap profits while they have market control. Also, price is key in substitutions. If the product is not valued at the price it is listed at, customers will find substitutes for the value. Second they will focus on reducing costs to compete with new entrants after the monopolization.9-6 Economics versus BusinessSG



Answer 2

Competitive IndustriesRelative to managers in more monopolistic industries, are managers in more competitive industries more likely to spend their time on reducing costs or on pricing strategies?oManagers are more likely to focus on pricing strategies.

Second they will focus on reducing costs to compete with new entrants after the monopolization.9-6 Economics versus BusinessSG.