Question: This question: 3 point ( s ) possible Angie bakes delicious cookies. Her total fixed cost is $ 1 1 5 a day, and her
This question: points possible
Angie bakes delicious cookies. Her total fixed cost is $ a day, and her average variable cost is $a bag. She is maximizing her profit by selling bags of cookies a day for $ a bag.
Few people know about Angie's Cookies. Angie thinks that if she spends $ a day on advertising, she can sell bags of cookies a day for $ a bag.
If Angie's belief about the effect of advertising is correct, can she increase her economic profit by advertising?
If Angie's belief about the effect of advertising is correct, she
A can increase her economic profit by advertising only if she raises the price of a bag of cookies
B cannot increase her economic profit by advertising because advertising increases her average total cost
C can increase her economic profit by advertising
D can increase her economic profit by advertising only if she lowers the price of a bag of cookies
E cannot increase her economic profit by advertising because advertising increases her total cost
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