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Sweet Treats Sells Its Extra- Large Cupcakes for $14 Each

Question 95

Multiple Choice

Sweet Treats sells its extra- large cupcakes for $14 each and the firm has a constant marginal cost of $6 per cupcake, which is equal to its (constant) average total cost. If Sweet Treats does not sell a cupcake the day it is produced, it is sold as day- old for $4. Sweet Treats should hold the number of cupcakes in inventory that makes the probability of selling that quantity of cupcakes or more equal to_______ .


A) 0.20
B) 0.60
C) 0.40
D) 0.80

Correct Answer:

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