his week we examine the things businesses need to know about business costs and profit maximizing or, in a worse case, loss minimizing. In the…

his week we examine the things businesses need to know about business costs and profit maximizing or, in a worse case, loss minimizing. In the process, we create a supply curve. Look around the stores and restaurants around you. Have you seen a lot of going out of business signs during the economic slump? GM and Chrysler filed for bankruptcy although both received bailout money. Discuss business profits that rely on fixed and variable costs and revenues. Can you give examples of the companies that have high pension costs? Why are companies using more technology input while reducing labor input? Why are the Average Cost Curves U-shaped? What is the Law of Diminishing Returns? Discuss a company’s two short run options: 1. stay open or 2. shut down.

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