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You run a ginger beer factory. Market research suggests a price of $8/bottle will produce the highest revenue. Yourun production with this level of operating
You run a ginger beer factory. Market research suggests a price of $8/bottle will produce the highest revenue. Yourun production with this level of operating leverage.
B: Fixed cost = 500 per month, Variable cost = $2/bottle
Now, a new competing firm enters the market, pricing their ginger beer at $4 per bottle. You can sell as much as you like at that price but can no longer sell any at the higher price
what is the shut down decision in the short run and long run?
A. shut down; shut down
B. open; open
C. open; shut down
D. shut down; open
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