Suppose a cell phone manufacturer currently sells 10,000 cell phones per week and makes a profit of $3,000 per week. A manager at the plant observes, "Although the last 2,000 cell phones we produced and sold increased our revenue by $1,000 and our costs by $2,000, we are still making an overall profit of $3,000 per week so I think we're on the right track. We are producing the optimal number of cell phones." Show the information you can derive from the above statements. Show your steps.
Suppose a cell phone manufacturer currently sells 10,000 cell phones per week and makes a profit of $3,000 per week. A manager at the plant observes, "Although the last 2,000 cell phones we produced and sold increased our revenue by $1,000 and our costs by $2,000, we are still making an overall profit of $3,000 per week so I think we're on the right track. We are producing the optimal number of cell phones." Show the information you can derive from the above statements. Show your steps.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Suppose a cell phone manufacturer currently sells 10,000 cell phones per week and makes a profit of $3,000 per week. A manager at the plant observes, "Although the last 2,000 cell phones we produced and sold increased our revenue by $1,000 and our costs by $2,000, we are still making an overall profit of $3,000 per week so I think we're on the right track. We are producing the optimal number of cell phones."
Show the information you can derive from the above statements. Show your steps.
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