Jane Westerlund Owns a Picture-Framing Shop,The Caplow Co

Jane Westerlund owns a picture-framing shop,The Caplow Co.The average price she receives for a picture she frames for a customer is $120.This price must cover her average costs for a typical framed picture of $5 for glass,$2 for matting,and $13 for the frame,and $30 for the labour involved.She must also cover monthly expenses of $1,000 for rent and insurance,$200 for heat and electricity,$500 for advertising,and $3,500 for her salary.Assuming everything else stays the same,if Westerlund wants to increase her monthly salary to $4,000,this would cause the slope of the total cost curve to _____ and the break-even quantity to _____.

A) decrease; stay the same
B) decrease; increase
C) increase; increase
D) stay the same; increase

Correct Answer:

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Access For Free