Question
Consider the following table that relates average cost and total cost to the amount produced for a firm. Suppose your company plans to make 51
Consider the following table that relates average cost and total cost to the amount produced for a firm.
Suppose your company plans to make 51 units this month, and all 51 units have been sold.A potential customer calls, asking to purchase one unit for $75.If your objective as a manager is to maximize profits this month, should you accept (produce 52) or reject the offer (continue to produce 51), and for what reason?
Group of answer choices
reject the offer because $75 is less than the $77 marginal cost to produce one more
accept the offer because $75 is greater than the $26 cost on average to make each one
reject the offer because $75 is less than the $1,352 cost of making 52
accept the offer because $75 is better than nothing
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