You Must Produce 200 Records This Week

question 40

Multiple Choice

You must produce 200 records this week.Using the Lagrangian technique,you determine the profit-maximizing combination of pink vinyl and blue vinyl records and find that the Lagrangian multiplier is $2.50.From this you conclude that:

• A) the marginal revenue is about $2.50.
• B) the average revenue is about $2.50.
• C) the average revenue exceeds average cost by about $2.50.
• D) the marginal revenue exceeds marginal cost by about $2.50.
• E) consumers prefer pink vinyl to blue vinyl.

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