You are the CFO of a firm that, when it produces 200 units, has an ATC of
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You are the CFO of a firm that, when it produces 200 units, has an ATC of $100. You sell each unit for 250 dollars. The CEO suggests expanding production to 201 units because according to his/her analysis, ATC will only increase to $101, which is still much lower than the selling price of $250. a) How much is the marginal cost of the 201 unit? Show work. b)What would you advise to the CEO about expanding production to the 201" unit? (Use only the info given and think about profits).
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Business Law The Ethical Global and E-Commerce Environment
ISBN: 978-0071317658
15th edition
Authors: Jane Mallor, James Barnes, Thomas Bowers, Arlen Langvardt
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