Author Question: Mars Inc produces 100,000 boxes of Snickers bars which sell for 4 a box. If variable costs are 3 per ... (Read 55 times)

pragya sharda · **on:** Jul 1, 2018

Mars Inc produces 100,000 boxes of Snickers bars which sell for 4 a box. If variable costs are 3 per box, and it has 150,000 fixed operating costs, in the short run, it should

A) shut down as fixed costs are not being covered.
B) keep producing as profits are 50,000.
C) keep producing as variable costs are being met.
D) keep producing as total costs are being recovered.

Question 2

If the government levies a specific tax on tobacco producers, the spending of consumers will probably

A) increase.
B) decrease.
C) remain unchanged.
D) depend on supply elasticity.