A firm builds shipping crates out of wood. How does the cost of producing a 1-cubic-foot crate

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A firm builds shipping crates out of wood. How does the cost of producing a 1-cubic-foot crate (each side is 1-foot square) compare to the cost of building an 8-cubic-foot crate if wood costs $ 1 a square foot and the firm has no labor or other costs? More generally, how does cost vary with volume?

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Managerial Economics and Strategy

ISBN: 978-0321566447

1st edition

Authors: Jeffrey M. Perloff, James A. Brander

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