Asked by Francies Guzman on Apr 29, 2024
Verified
(Table: Cakes) Use Table: Cakes.Pat is opening a bakery to make and sell special birthday cakes.She is trying to decide how many mixers to purchase.Her estimated fixed and average variable costs if she purchases 1,2,or 3 mixers are shown in the table.Assume that average variable costs do not vary with the quantity of output.If Pat purchases 3 mixers,her average total cost _____ in the range of output between 100 and 400 cakes.
A) increases
B) decreases
C) remains the same
D) can't be calculated
Average Total Cost
The sum of all production costs divided by the quantity of output produced, representing the per-unit cost of production.
Mixers
Devices used for mixing components; in an economic context, could refer to firms or gadgets blending products in the market.
Range of Output
The difference between the maximum and minimum quantities of a product that a company can produce or sell over a certain period.
- Assess the influence of scale magnitude on operational costs across short and prolonged intervals.
Verified Answer
KP
kajal patelMay 02, 2024
Final Answer :
B
Explanation :
According to the table, the average total cost decreases as the number of mixers increases. Therefore, if Pat purchases 3 mixers, her average total cost would decrease in the range of output between 100 and 400 cakes.
Learning Objectives
- Assess the influence of scale magnitude on operational costs across short and prolonged intervals.