Marcella is deciding whether to start a bakery in her hometown. She should start it if she expects that:
A)her marginal revenue will be below her marginal cost.
B)her average revenue will exceed her average cost.
C)the average cost curve will shift downward.
D)the number of bakeries will soon decrease.

Question

Quizplus · Accepted Answer

Marcella should start the bakery if her average revenue (price) will exceed her average cost. This means that she will be making a profit on each item sold. The other options do not necessarily indicate profitability or success in starting a bakery.

Marcella Is Deciding Whether to Start a Bakery in Her