ABSTRACT
In this chapter we apply the analysis of the previous chapter and illustrate separately the effects on the firm of two common occurrences: (1) a change in the product price and (2) a change in a resource price, such as the labor cost per hour. Only one change at a time is assumed in our firm in order to trace its effects. We repeat the type of analysis shown in Diagram 8.1 of the previous chapter but under the changed conditions.
