Multiple Choice
Use the information below to answer the following questions.
Fact 13.3.3
Suppose that Roots' marginal cost of a jacket is a constant $125.00 and the total fixed cost at one of its stores is $1,500 a day.This store sells 20 jackets a day,which is its profit-maximizing number of jackets.Then the stores nearby start to advertise their jackets.The Roots store now spends $2,000 a day advertising its jackets,and its profit-maximizing number of jackets sold jumps to 70 a day.
-Refer to Fact 13.3.3.After the advertising begins,the average total cost of a jacket sold in this store is
A) $200.00.
B) $175.00.
C) $150.00.
D) $125.00.
E) $100.00.
Correct Answer:

Verified
Correct Answer:
Verified
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