The owner of Stewart's Sleep Shops, an upscale furniture retailing operation that specializes in bedroom furniture and furnishings, has received an ultimatum from his banker: "personally guarantee your loans or the bank will call them in." The Windsor-Chatham area, the home of Stewart's Sleep Shops, is in the middle of recession. The owner must assess the future viability of his operation in order to determine whether to personally guarantee the loans. The case challenges students to make use of various tools of economic analysis to develop a clear understanding of the situation facing the owner and the alternatives available to him.
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