Business, 28.03.2020 03:39 lululoveee586
Firm A produces gadgets. The price of gadgets is $2 each. Firm A has total fixed costs of $1,000,000 and variable costs of $1 per gadget. The corporate tax rate is 40%. If the economy is strong, the firm will sell 2,000,000 gadgets. If the economy enters a recession, the firm will sell only half as many gadgets. If the economy enters a recession, the after-tax profit of firm A will be .
A. $0
B. $270,000
C. $90,000
D. $180,000
Answers: 3
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Firm A produces gadgets. The price of gadgets is $2 each. Firm A has total fixed costs of $1,000,000...
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