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Average total cost

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1)If Redstone wanted to minimize average total cost, it would produce how many units?

2). If Redstone wishes to maximize profit MARGIN, it should produce how many units.

3) What level of output should the manager of Redstone choose to produce? Explain briefly

4. Now triple the fixed costs to 15,000 in your spreadsheet. How does this change your answer to question 4. Explain briefly

5). Suppose that Nancy Pelosi declares that clay fire pits are causing global warming, and demand for fire pits shrinks substantially in the U.S. (especially in California). Fire pit prices fall worldwide to $65. Now, the manager of Redstone should produce how many units? Explain your answer

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Solution Preview

Please see attached file and the following.

4. When fixed cost is tripled,Redstone should still be producing 700 units to maximize ...

Solution Summary

Average total cost is fully calculated.

$2.19