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lectur24-page4 - TVC = TVC 1- TVC = $271,110 - $95,000 =...

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Therefore average costs have limited usefulness for economic decisions. Lets analyze this same problem in somewhat of a different light: TR = TR 1 - TR 0 = $300,000 - $150,000 = $150,000 SUNK COSTS ARE IRRELEVANT
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Unformatted text preview: TVC = TVC 1- TVC = $271,110 - $95,000 = $176,110 TNR = TR - TVC = $150,000 - $176,110 = $-26,110 From this line of reasoning we develop a fundamental rule for making economic decisions:...
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This note was uploaded on 12/29/2011 for the course ECO 210 taught by Professor Malls during the Fall '10 term at SUNY Stony Brook.

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