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Consider a Small Firm That Is Producing Winter Jackets

Question 5

Multiple Choice

Consider a small firm that is producing winter jackets.It can lease an additional sewing machine for one month for $1200.With this additional machine,the firm can produce an additional 7 jackets during that time period that it sells for $250 each.Hiring the marginal machine adds to the firm's profit and so it should _ the machine.


A) $1200; lease
B) $1750; lease
C) $550; lease
D) - $1200; not lease
E) $0; be indifferent as to whether to lease

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