Use the Information Below to Answer the Following Questions

question 34

Multiple Choice

Use the information below to answer the following questions.
Fact 13.3.3
Suppose that Roots' marginal cost of a jacket is a constant $125.00 and the total fixed cost at one of its stores is $1,500 a day.This store sells 20 jackets a day,which is its profit-maximizing number of jackets.Then the stores nearby start to advertise their jackets.The Roots store now spends $2,000 a day advertising its jackets,and its profit-maximizing number of jackets sold jumps to 70 a day.
-Refer to Fact 13.3.3.Before the advertising begins,the average total cost of a jacket sold in this store is

• A)$200.00.
• B)$175.00.
• C)$150.00.
• D)$125.00.
• E)$100.00.

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Definitions:

Simple Interest

Interest calculated solely on the principal amount of a loan or investment, without compounding over time.

360-Day Year

This is a simplified method used in some financial calculations where the year is assumed to have 360 days for ease of interest computation.

Total Amount

The complete sum or quantity of something, encompassing all components or elements.

Ordinary Interest

Interest that is calculated based on a 360-day year, often used in banking and finance for simplifying interest calculations on loans and investments.