Problem 8-1 A newly formed firm must decide on a plant location. There are two alternatives under consideration: locate near the major raw materials or locate near the major customers. Locating near the raw materials will result in lower fixed and variable costs than locating near the market, but the owners believe there would be a loss in sales volume because customers tend to favor local suppliers. Revenue per unit will be $179 in either case. Omaha Kansas City Annual fixed costs ($ millions) $ 1.0 $ 1.1 Variable cost per unit $ 29 $ 44 Expected annual demand (units) 9,850 10,450 Using the above information, determine which location would produce the greater profit. (Omit the "$" sign in your response.) would produce the greater gross profit of $ 950950 .

Partnerships are the most common type of business firms in the world. t/f

How will firms solve the problem of an economic surplus a. decrease prices to the market equilibrium price b. decrease prices so they are below the market equilibrium price c.increase prices

Consider the market for gasoline. suppose that, in a competitive market without government regulations, the equilibrium price of gasoline is $3.00 per gallon, and employees at gas stations earn $17.50 per hour. complete the following table by indicating whether each of the statements is an example of a price ceiling or a price floor and whether it results in a shortage or a surplus or has no effect on the price and quantity that prevail in the market. statement price control effect the government has instituted a legal minimum price of $3.40 per gallon for gasoline. the government prohibits gas stations from selling gasoline for more than $3.40 per gallon. due to new regulations, gas stations that would like to pay better wages in order to hire more workers are prohibited from paying more than $14.50 per hour.