Two firms, H and D, both produce salad bowls. The price of salad bowls is $4 each. Firm H has total fixed costs of $2,50
Posted: Wed May 18, 2022 11:17 pm
Two firms, H and D, both produce salad bowls. The price of salad
bowls is $4 each. Firm H has total fixed costs of $2,500,000 and
variable costs of $1.15 per salad bowl. Firm D has total fixed
costs of $1,200,000 and variable costs of $2.00 per salad bowl. The
corporate tax rate is 40%. If the economy is strong, each firm will
sell 2,000,000 salad bowls. If the economy enters a recession, each
firm will sell 1,400,000 salad bowls.
If the economy enters a recession, the after-tax profit of Firm D
will be
Group of answer choices
$810,000
$600,000
$960,000
$1,600,000
bowls is $4 each. Firm H has total fixed costs of $2,500,000 and
variable costs of $1.15 per salad bowl. Firm D has total fixed
costs of $1,200,000 and variable costs of $2.00 per salad bowl. The
corporate tax rate is 40%. If the economy is strong, each firm will
sell 2,000,000 salad bowls. If the economy enters a recession, each
firm will sell 1,400,000 salad bowls.
If the economy enters a recession, the after-tax profit of Firm D
will be
Group of answer choices
$810,000
$600,000
$960,000
$1,600,000