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The diagrams shown below depict the cost curves of two plants owned by a firm producing video games. 110 100 90- 80- 70 8
The diagrams shown below depict the cost curves of two plants owned by a firm producing video games. 110 100 90- 80- 70 8 80+ Price 50- 40- 30 Alpha MC ATC Price Beta 110- 100 90 80 70 -09 50 MC ATC 40 30- 20- 20- 10- 10 20 30 40 50 60 70 80 90 100 Alpha's quantity (in thousands) 10 016 26 36 40 50 60 70 80 90 100 Beta's quantity (in thousands) From the positions the curves hold in each graph, it can be deduced that the older, less efficient facility is If video games are produced in a competitive market and the current price is $70. production in Alpha is in Beta is thousand units. thousand units and production If management sought to transfer 10 thousand units of Beta's production to Alpha, the firm's overall profits would those 10 thousand additional units since for
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