As a prospective owner of a club known as the red rose, you are interested in determining the volume of sales dollars necessary for the coming year to reach the break-even point. you have decided to break down the sales for the club into four categories, they are as follows: category estimated sales cost per unit sales price per unitbeer 30,000 $0.75 $1.50meals 10,000 $5.00 $10.00dessert/wine 10,000 $1.00 $2.50lunches/sandwiches 20,000 $3.25 $6.25your fixed cost is $1800 per month plus $2000 per month for entertainment. a) what is your break even point? b).what is the expected number of meals eaach day if you are open 30 days a month?

the answer should be a)

answer: in the short-run firms will respond by raising the price of turkey.

explanation: initially the long-run equilibrium is at a price of $5 per pound of turkey and a quantity of 50 million pounds per year. now, when webmd claims that a protein found in turkey will increase your expected lifespan by 4 years. the consumers demand for turkey will increase at every price shifting the demand curve to the right from d1 to d2. while, there will be no change in the supply curve in the short-run as it is not possible for producers to adjust supply so quickly. as a result the new equilibrium will occur at a higher price and a higher quantity of turkey.

thus, in the short run firms will respond by increasing the price of turkey, selling more quantity at a higher price and earning economic profits.