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HACTEHA [7]
3 years ago
6

Josefina is the only seller of sopapillas in town. Last week, she sold 200 sopapillas, and the marginal revenue of the 200th sop

apilla was $1.50 and the marginal cost was $1.75. Is Josefina maximizing her profit?
Business
1 answer:
Alex73 [517]3 years ago
7 0

Answer:

Josefina is not maximizing her profits since she is making a loss of $0.25.

Explanation:

The marginal revenue is the total amount of revenue received from selling an additional unit of product while the marginal cost is the total cost incurred for producing an additional unit of product. The marginal cost and revenue can be compared to determine if producing and selling an additional unit is profitable or will cause a loss.

The profit/loss can be expressed as;

P/L=R-C

where;

P=profit

L=loss

R=total marginal revenue

C=total marginal cost

In our case;

P/L=unknown

R=marginal revenue per unit×number of units=1.50×1=$1.50

C=marginal cost per unit×number of units=$1.75×1=$1.75

replacing;

P/L=1.50-1.75=-$0.25

Since the marginal cost is greater than the marginal revenue, we can conclude that Josefina is making a loss of $0.25

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Answer:

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Explanation:

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Hey there!

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7 0
3 years ago
4. You are considering adding a microbrewery onto one of your firm's existing restaurants. This will entail an increase in inven
IrinaK [193]

Answer:

$6400

Explanation:

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5 0
3 years ago
In the recent past, the government has attempted to stimulate the economy by sending tax refunds to individual people so that th
blondinia [14]

Answer:

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3 0
3 years ago
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Lynna [10]

Answer:

c. fall primarily on employees

Explanation:

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