Use the Following to Answer Question

question 105

Multiple Choice

Use the following to answer question:
-(Table: Variable Costs for Lots) Use Table: Variable Costs for Lots.During the winter,Alexa runs a snow-clearing service in a perfectly competitive industry.Assume that costs are constant in each interval;so,for example,the marginal cost of clearing each of the lots from 1 through 10 is $20.Also assume that she can only plow the quantities of the lots given in the table (and not numbers in between) .Her only fixed cost is $1,000 for a snowplow.Her variable costs include fuel,her time,and hot coffee.If the price to clear a lot is $30,what is Alexa's profit per unit at the optimal output?

• A)-$13.75
• B)$720
• C)$0
• D)-$12.25

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Definitions:

Cash Flow

The whole quantity of financial inflows and outflows in a company, profoundly affecting its liquidity metrics.

Stockholders

Individuals or entities that own shares in a corporation, giving them ownership interests and rights to dividends.

Taxes

Mandatory monetary fees or different forms of charges levied on an individual or entity by a government body to finance government operations and several public services.

Interest Paid

Interest paid refers to the amount of money paid over a period for the use of borrowed funds, representing the cost of borrowing to the debtor.