If it costs View Your World, a high-end window manufacturer, $25 per window to install a higher quality glass in its windows and consumers will pay an additional $30 per window for the improvement, which of the following is true?
A) View Your World should install the higher quality glass because the marginal revenue from the quality enhancement is less than the marginal cost.
B) View Your World should not install the higher quality glass because the marginal revenue from the quality enhancement is less than the marginal cost.
C) View Your World should not install the higher quality glass because the marginal revenue from the quality enhancement exceeds the marginal cost.
D) View Your World should install the higher quality glass because the marginal revenue from the quality enhancement exceeds the marginal cost.
D) View Your World should install the higher quality glass because the marginal revenue from the quality enhancement exceeds the marginal cost.
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Refer to the above figure. A price ceiling of $20 results in
A) a shortage of 100 units. B) a shortage of 200 units. C) a surplus of 100 units. D) a surplus of 200 units.
You purchased two stocks that are perfectly negatively correlated
A) Your portfolio is well diversified, so you should face no risk whatsoever. B) Even though you diversified the idiosyncratic risk away, your portfolio is still affected by systemic risks like a stock market crash. C) Even though you diversified the systemic risk away, your portfolio is still affected by idiosyncratic risks like a stock market crash. D) Your portfolio is not diversified; thus you face no systemic risk.