Allison's Auto Art is a company that applies pinstripes to vehicles. Allison's cost for a basic 1-color pinstriping job is $35, and she charges $95 for this service. For a total price of $175, Allison will apply a fancier 3-color pinstripe application to an automobile, a service that adds an additional $40 to the total cost of the package. Should Allison continue to offer the 3-color pinstripe application?
A) Yes, she still makes a profit by selling the 3-color application.
B) yes, but only if she lowers the price of the 1-color application
C) No, her marginal benefit is less than her marginal cost.
D) More information is needed for Allison to make this decision.
Correct Answer:
Verified
Q12: Suppose that some teachers have decided that
Q16: The basic economic problem of _ has
Q19: Consider the following statements:
a. Car owners purchase more
Q21: The extra cost associated with undertaking an
Q27: Marginal analysis involves undertaking an activity
A)until its
Q28: Allison's Auto Art is a company that
Q29: Scenario 1-1
Suppose a cell phone manufacturer currently
Q31: A grocery store sells a bag of
Q35: Scenario 1-1
Suppose a cell phone manufacturer currently
Q38: Making "how much" decisions involves
A)calculating the total
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents