Gilligan runs the only dry-cleaning business on a desert isle.If the cost of cleaning fluid falls,he can increase profit by _____
A)accepting fewer dry-cleaning orders.
B)charging the highest price he can.
C)using less cleaning fluid.
D)lowering his price.
E)charging a price that is equal to marginal cost.

Question

Quizplus · Accepted Answer

Lowering his price will lead to an increase in demand for dry-cleaning, resulting in increased revenue and profit. This is because with lower cleaning fluid costs, Gilligan can afford to offer a lower price while still making a profit. By doing so, he can potentially attract more customers and generate additional business.

Gilligan Runs the Only Dry-Cleaning Business on a Desert Isle