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Home Q & A Board Other Fields Homework Help Business Economics
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Tidy Tidy
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9 years ago
Suppose Jason owns a small pastry shop. Jason wants to maximize his profit, and thinking back to the college microeconomics class he took in college, he decides he needs to produce a quantity of pastries which will minimize his average total cost. Will Jason's strategy necessarily maximize profits for his pastry shop?
A) Yes; Since jason's pastry shop is in a perfectly competitive market, the only way to maximize profit is to produce the quantity where average total cost is minimized.
B) Not necessarily; This strategy will only maximize Jason's profit in the long run, but not in the short run.
C) No; In order to maximize profit, Jason would never want to produce the quantity where average total cost is minimized.
D) Not necessarily; Depending on demand, Jason may maximize profit by producing a quantity other than that where average total cost is at a minimum.
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Essentials of Economics

Essentials of Economics


Edition: 4th
Authors:
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Repeat after me: 'Calm down. Things are gonna be fine. Things are gonna be all great. Just relax.' Wink Face
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VincenzoDVincenzoD
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Thanks!
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