Week 2 Post 2 - C. I disagree, running a business in the...

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Chapter 8, Problem #7 (a,b,c) A. I agree that the firm should increase output until the marginal cost is equal to the marginal revenue. Any output over marginal revenue will not be profitable. (Case, Fair, & Oster, 2009) B. I agree the average cost will follow the marginal cost whether it is declining or rising. However it is not simultaneous, it lags behind the marginal cost. (Case, Fair, & Oster, 2009)
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Unformatted text preview: C. I disagree, running a business in the short run or not incurs a cost, even if there is zero output. That cost is called overhead, The rent on office space can be thought of as a fixed cost in the short run. (Case, Fair, & Oster, 2009) Travers Bracy Case, K. E., Fair, R. C., & Oster, S. M. (2009). Principles of Microeconomics. Upper Saddle River: Pearson Prentice Hall....
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This note was uploaded on 06/05/2011 for the course MICROECONO 204 taught by Professor Sydneyokolo during the Spring '11 term at Ashford University.

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