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.
-What is the total cost,at the level of production where Pastry Paradise is indifferent between which technology is used?
A) $1750
B) $1000
C) $1500
D) $2000
Correct Answer:
Verified
Correct Answer:
Verified
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