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Ball Bearings Inc faces costs of production as follows Calculate the company’s average fixed costs

Ball Bearings, Inc. faces costs of production as follows:  a. Calculate the company’s average fixed costs, average variable costs, average total costs, and marginal costs at each level of production. b. The price of a case of ball bearings is $50. Seeing that she can’t make a profit, the Chief Executive Officer (CEO) decides to shut down operations. What are the firm’s profits/ losses? Was this a wise decision? Explain. c. Vaguely remembering his introductory economics course, the Chief Financial Officer tells the CEO it is better to produce 1 case of ball bearings, because marginal revenue equals marginal cost at that quantity. What are the firm’s profits/losses at that level of production? Was this the best decision?Explain.

May 01 2020 View more View Less

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