Exhibit 7-15 Short-run cost curves for E-Z Care lawn mowing company

-In Exhibit 7-15,what market price would cause E-Z-Care to just beak even?

Question

Exhibit 7-15 Short-run cost curves for E-Z Care lawn mowing company
 
-In Exhibit 7-15,what market price would cause E-Z-Care to just beak even?

Quizplus · Accepted Answer

The break-even point occurs where the total cost curve intersects with the total revenue curve. In Exhibit 7-15, this occurs at a market price of $12 per lawn, where the total cost and total revenue both equal $60. At any price below $12, the company incurs losses, and at any price above $12, the company earns profits. Therefore, C is the correct answer.

Exhibit 7-15 Short-Run Cost Curves for E-Z Care Lawn Mowing