Case Study: Starting a Business Answers
What did you discuss in your response? Check all that apply.
Pair 2: $[___]
51
Pair 3: $[___]
80
This graph shows the marginal cost of producing each additional pair of running shoe inserts.Based on the graph, which pair of shoes has a marginal cost of $3.00?
Pair 1: $[___]
23
This graph shows the marginal costs of each pair of running shoe inserts produced. Select the correct answer from the options available.At what level of production are you making the greatest profit?
In this lesson, you started by reviewing customer demand before choosing a business.What microeconomic factors point to the fact that your business should be successful? Be sure to provide evidence for your claim.
The business should be successful because surveys and market research show that consumers are able and willing to buy custom outdoor shoe equipment. The area's high standard of living indicates that customers can afford the product, while the lack of demand for new coffee shops and their greater capital and competition risks make the shoe business a better opportunity.
After you analyzed demand, you took steps to make sure your business made sense financially.How will thinking on the margin help increase the chance of long-term success for your business, even if additional competition enters your community?
Thinking on the margin helps me compare the additional costs and benefits of producing each unit. I can increase production while the additional revenue is greater than the additional cost, but reduce production when it is no longer profitable. This knowledge also helps me adjust prices or offer discounts while remaining profitable, allowing my business to compete and succeed over the long term.
Using this table, calculate the profit at each level of running shoe inserts production.
Which factors did you include in your response? Check all that apply.
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