Use the following data for a competitive industry and a price-taking firm that operates in this market.
Bartech, Inc. is a firm operating in a competitive market. The manager of Bartech forecasts product price to be $28 in 2015. Bartech's average variable cost function is estimated to be Bartech expects to face fixed costs of $12,000 in 2015
Now, suppose that the 2015 price forecast is drastically revised downward to $5.
-What is Bartech's profit-maximizing (or loss-minimizing) output for 2015?
A) 0 units
B) 1,000 units
C) 2,000 units
D) 3,000 units
E) 4,000 units
Correct Answer:
Verified
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