Jimmy,Walter,Mike,and Bill run a school for political candidates.The school has fixed costs of $10 million,variable costs of $4 million,and total revenue of $15 million.In the short run the school will _____ and in the long run the school will ___.

Question

Quizplus · Accepted Answer

In the short run, the school will continue to operate since it is generating enough revenue to cover its variable costs and make some contribution towards its fixed costs. However, in the long run, the school may need to reevaluate its operations since it is not making enough profit to cover all of its costs. It may need to make changes or adjustments, such as increasing tuition fees or reducing variable costs, in order to stay in business in the long run.

Jimmy,Walter,Mike,and Bill Run a School for Political Candidates