Purchase Solution

Moving Downtown! Relevant and Irrelevant Costs

Not what you're looking for?

Ask Custom Question

Evaluate the second partner's advice not to move downtown. Illustrate and fully explain using an example of relevant cost (a cost whose value does affect the optimal decision) and an example of irrelevant cost (a cost whose value does not affect the optimal decision) to the business regarding this decision.

Purchase this Solution

Solution Summary

This solution provides a brief explanation of the difference of relevant and irrelevant costs, and provides examples of each in the context of a decision to relocate a company.

Solution Preview

A relevant cost is a cost that changes/differs with regard to a particular decision. In this case, the downtown rent will be higher than what these two partners are currently paying, making ...

Purchase this Solution

Free BrainMass Quizzes
Economic Issues and Concepts

This quiz provides a review of the basic microeconomic concepts. Students can test their understanding of major economic issues.

Basics of Economics

Quiz will help you to review some basics of microeconomics and macroeconomics which are often not understood.

Elementary Microeconomics

This quiz reviews the basic concept of supply and demand analysis.

Economics, Basic Concepts, Demand-Supply-Equilibrium

The quiz tests the basic concepts of demand, supply, and equilibrium in a free market.

Pricing Strategies

Discussion about various pricing techniques of profit-seeking firms.