Answer to Question #83500 in Microeconomics for aysha

Question

a. What is your explanation on prevailing cost conditions of the chosen firm?

Answer 1

Understanding the prevailing cost conditions of a firm is a major task because it can highly affect the competitive advantage of it's market. The cost structure of a candy making company can thus be predicted. A candy making company with high profits is an indication that the production cost is low. Low profits on the other hand show that there is high production cost.