To maximize its profit, the firm in the figure above produces ________ cans per day and ________
A) 0; incurs an economic loss of less than $20
B) between 3 to 5 cans; earns a normal profit
C) 10; earns an economic profit of $2.90
D) 10; earns an economic profit of $29
E) more than 10; earns an economic profit
D
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If Papagna's Pizza Parlor knows that the marginal cost of the 500th pizza is $3.00 and that the average total cost of making 499 pizzas is $3.30, then
a. average costs are rising at Q = 500 b. average costs are falling at Q = 500 c. total costs are falling at Q = 500 d. average variable costs must be falling e. average variable costs must be rising
If education produces positive externalities, we would expect
a. the government to tax education. b. the government to subsidize education. c. people to realize the benefits, which would increase the demand for education. d. colleges to relax admission requirements.