5. Katie's Quilts is a small retailer of quilts and other bed liner products. Katie currently purchases quilts from a large producer for $100 each and sells them in her store at a price that does not change with the number of quilts she sells. Katie is considering vertically integrating by making her own quilts. If the fixed cost of vertically integrating is $10,000 and she can produce quilts at $50 per quilt, her total cost of producing quilts, q, herself is C 10000 + 50q. How many quilts does Katie need to sell for vertical integration to be a profitable decision? =

5. Katie's Quilts is a small retailer of quilts and other bed liner products. Katie currently purchases quilts from a large producer for $100 each and sells them in her store at a price that does not change with the number of quilts she sells. Katie is considering vertically integrating by making her own quilts. If the fixed cost of vertically integrating is $10,000 and she can produce quilts at $50 per quilt, her total cost of producing quilts, q, herself is C 10000 + 50q. How many quilts does Katie need to sell for vertical integration to be a profitable decision? =

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter7: Production, Costs, And Industry Structure

Section: Chapter Questions

Problem 4SCQ: Based on your answers to the WipeOut Ski Company in Exercise 7.3, now imagine a situation where the...

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