Maxim manufactures a cat food product called green health. maxim currently has 10,000 bags of green health on hand. the variable production costs per bag are $2.80 and total fixed costs are $10,000. the cat food can be sold as it is for $8.15 per bag or be processed further into premium green and green deluxe at an additional $3,000 cost. the additional processing will yield 10,000 bags of premium green and 4,000 bags of green deluxe, which can be sold for $7.15 and $5.15 per bag, respectively. if green health is processed further into premium green and green deluxe, the total gross profit would be:

The business cycle is the periodic but irregular up-and-down movement in economic activity, measured by fluctuations in real gross domestic product (gdp) and other macroeconomic variables. a business cycle is typically characterized by four phases—recession, recovery, growth, and decline—that repeat themselves over time. economists note, however, that complete business cycles vary in length. the duration of business cycles can be anywhere from about two to twelve years, with most cycles averaging six years in length. some business analysts use the business cycle model and terminology to study and explain fluctuations in business inventory and other individual elements of corporate operations. but the term "business cycle" is still primarily associated with larger (industry-wide, regional, national, or even international) business trends.

The law of supply and demand