Graded Discussion: Cost of Popcorn
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Listen to the following NPR audio clip on the cost of popcorn spikes.
http://www.npr.org/templates/story/story.php?storyId=92529379 (Links to an external site.)Links to an external site.
(Links to an external site.)Links to an external site.Then, applying what you have learned in Chapters 1-6, but especially Chapter 6, and Hedrick Hint's Chapter 6, briefly discuss and provide examples of the following questions related to the cost of popcorn:
(1) What two factors did Hedrick's Hint's say are the basic determinants of costs? Download, don't use the Canvas viewer, the Powerpoint in the non-graded activities. It is NOT fixed and variable costs NOR explicit/direct and implicit/indirect! Read my lecture notes and find the answer. Give examples of both determinants from the audio clip;
(2) What's the difference between direct (explicit) and indirect (implicit) costs? Give an example of both from the audio clip;
(3) Did Will Weaver seem to be driven to minimize costs (briefly justify your answer)? Give two reasons why business people worry about the costs of production.
Can you see the cost curves now? They are everywhere and quite useful:)