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Use the Following to Answer Questions: Table: Two Factories -(Table: Two Factories) If This Firm Is Producing 1 Unit

Question 47

Multiple Choice

Use the following to answer questions: Table: Two Factories  Output  Factory l  Marginal  Output  Output  Factory 2  Marginal  Cost 001$1.001$0.5022.0021.0033.0031.5044.0042.0055.0052.5066.0063.00\begin{array} { c c c c } \hline \text { Output }& \begin{array} { c } \text { Factory l } \\\text { Marginal } \\\text { Output }\end{array} & \text { Output } & \begin{array} { c } \text { Factory 2 } \\\text { Marginal } \\\text { Cost }\end{array} \\\hline 0 & - & 0 & - \\1 & \$ 1.00 & 1 & \$ 0.50 \\2 & 2.00 & 2 & 1.00 \\3 & 3.00 & 3 & 1.50 \\4 & 4.00 & 4 & 2.00 \\5 & 5.00 & 5 & 2.50 \\6 & 6.00 & 6 & 3.00 \\\hline\end{array}
-(Table: Two Factories) If this firm is producing 1 unit from Factory 1 and 5 units from Factory 2, it should:


A) produce 1 less unit in factory 2 and produce 1 more unit in Factory 1.
B) produce all 6 units in Factory 2, the low-cost factory.
C) not change production because it is minimizing costs.
D) produce 1 unit in factory 2 and produce 5 more units in Factory 1.

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