A computer manufacturer sells 1,000 units per month at $500 each. A price cut to $400 is being considered. His marginal cost is constant at $300 per unit. To maintain profits, quantity sold must increase to at least
a. 1,500.
b. 2,000.
c. 2,500.
d. 3,000.
b
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Given that the firm only chooses to sell the no-name brand, how should it price its product?
a. Price low, sell to both users b. Price high, sell only to the professional chefs c. Price low, sell only to the professional chefs d. Price high, sell only to the home users
If the marginal propensity to consume (MPC) is 0.60, what is the spending multiplier?
a. 0.4. b. 0.6. c. 2.5. d. 6.0.
A positive (non-zero) price for a good means there is a surplus of that good
a. True b. False Indicate whether the statement is true or false
Which of the following is a market imperfection that might explain persistent wage differentials within an occupation?
A. Geographical immobility of workers. B. Readily available information about job opportunities and pay. C. Principal-agent problems. D. Compensating wage differentials.