Materials used by jefferson company in producing division c's product are currently purchased from outside suppliers at a cost of $10.00 per unit. however, the same materials are available with division a. division a has unused capacity and can produce the materials needed by division c at a variable cost of $8.50 per unit. a transfer price of $9.50 per unit is negotiated and 25,000 units of material are transferred, with no reduction in division a's current sales. how much will division a's income from operations increase? a. $50,000 b. $25,000 c. $0 d. $75,000

None of the above.

Total Income from operation increase.  12,500.00

Explanation:

$          10.00Per unit

$            9.50Per unit

$            0.50Per unit

25.000Units

Total Income from operation increases      12,500.00

answer; ///hong kong;

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.