writing about profits\ndemand for bikes has suddenly increased, and the market price has risen from $50 to…
writing about profits\ndemand for bikes has suddenly increased, and the market price has risen from $50 to $60.\nin three to five sentences, explain how this change will affect profits.
Answer
Brief Explanations:
Profit is revenue minus cost. With a higher market - price ($60 instead of $50), assuming costs remain the same, revenue per bike sold increases. This will likely lead to higher total profits as long as the quantity sold doesn't decrease significantly due to other factors.
Answer:
The increase in market price from $50 to $60, with demand rising and costs unchanged, will likely boost profits as revenue per unit sold increases.