You’re thinking of buying one of two firms. one has a profit margin of $4 per unit; the other has a profit margin of $10 per unit. which should you buy? why?
if both firms are producing where mr = mc and you could buy either for the same amount, then you should buy the firm:
a. that has a profit margin of $4 per unit because it must be producing more and is therefore earning the higher total profits.
b. that has a profit margin of $10 per unit because it must be producing more and is therefore earning the higher total profits.
c. there is not enough information to determine which firm to buy.
d. the one with the highest total profit should be bought.
e. that has a profit margin of $10 per unit.
a higher profit margin means that you could increase output and further increase total profits.

5. profit maximization and shutting down in the short run suppose that the market for polos is a competitive market. the following graph shows the daily cost curves of a firm operating in this market. 0 2 4 6 8 10 12 14 16 18 20 50 45 40 35 30 25 20 15 10 5 0 price (dollars per polo) quantity (thousands of polos) mc atc avc for each price in the following table, calculate the firm's optimal quantity of units to produce, and determine the profit or loss if it produces at that quantity, using the data from the previous graph to identify its total variable cost. assume that if the firm is indifferent between producing and shutting down, it will produce. (hint: you can select the purple points [diamond symbols] on the previous graph to see precise information on average variable cost.) price quantity total revenue fixed cost variable cost profit (dollars per polo) (polos) (dollars) (dollars) (dollars) (dollars) 12.50 135,000 27.50 135,000 45.00 135,000 if the firm shuts down, it must incur its fixed costs (fc) in the short run. in this case, the firm's fixed cost is $135,000 per day. in other words, if it shuts down, the firm would suffer losses of $135,000 per day until its fixed costs end (such as the expiration of a building lease). this firm's shutdown price—that is, the price below which it is optimal for the firm to shut down—is per polo.

Your take on decision making process

11.     before adding cream to a simmering soup, you need to a. simmer the cream. b. chill the cream. c. strain the cream through cheesecloth. d. allow the cream reach room temperature. student d   incorrect which answer is right?