Prawns Galore, a prawn harvesting business in Southeast Queensland, has a 30-year loan on its prawn trawling boat.The annual loan payment is $25 000 and the boat has a market (salvage) value that exceeds its outstanding loan balance.Prior to the 2001 prawn harvesting season, Prawns Galore's accountant predicted that at expected market prices for prawns, Prawns Galore would have a net loss of $75 000 dollars after paying all 2001 expenses (including the annual loan payment) .In this case, Prawns Galore should:
A) continue to operate even though it predicts a loss of $75 000
B) not produce and experience a loss of $25 000
C) not produce and experience a loss of $75 000
D) continue to operate because expected profits will rise in the future
Correct Answer:
Verified
Q105: Graph 14-6 Q106: Profit-maximising firms enter a competitive market when: Q107: A profit-maximising firm that is showing losses Q108: A production cost that has already been Q109: Which of the following statements best reflects![]()
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