Kara's Kittens typically produces and sells at its optimal (lowest per-unit cost) level of 30 scratching posts per week. Kara's also maintains an inventory of 20 scratching posts. If prices are sticky and there is a positive demand shock this week resulting in demand for 40 scratching posts, we would expect Kara's to:

A. sell the additional scratching posts out of its inventory and rebuild the inventory later when
a negative demand shock occurs.
B. permanently expand production to 40 scratching posts per week.
C. raise prices on scratching posts.
D. introduce a new line of scratching posts.

Answer: A