Multiple Choice
Use the following setup for the next question.
Pastry Paradise is looking to expand.It decides to take over Sweet Tooth,a competitive firm.The two firms have similar technology but different costs.Pastry Paradise has $1500 fixed costs and $1 marginal cost per unit produced.Sweet Tooth has $500 fixed costs but $5 marginal cost per unit produced.
-If Pastry Paradise takes over Sweet Tooth,at what level of production would it be indifferent between which technology is used.
A) 500
B) 750
C) 250
D) 125
Correct Answer:
Verified
Correct Answer:
Verified
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