​Use the Following Setup for the Next Question

question 11

Multiple Choice

​Use the following setup for the next question.
Pastry Paradise is looking to expand.It decides to take over Sweet Tooth,a competitive firm.The two firms have similar technology but different costs.Pastry Paradise has $1500 fixed costs and $1 marginal cost per unit produced.Sweet Tooth has $500 fixed costs but $5 marginal cost per unit produced.
-​What is the total cost,at the level of production where Pastry Paradise is indifferent between which technology is used?

• A)​$1750
• B)$1000
• C)$1500
• D)​$2000

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Definitions:

Commuter Rail

A passenger rail transport service that primarily operates within urban areas, connecting workers to their places of employment.

Positive Correlation

A relationship between two variables where they move in the same direction, meaning when one variable increases, the other also increases, and vice versa.

Slope

In mathematics, the measure of the steepness or incline of a line, often calculated as the ratio between the change in the y-value to the change in the x-value.

Horizontal Line

In geometry and graphing, a straight line that runs left to right (parallel to the x-axis) and has a slope of zero, indicating no change in the y-value across different points on the line.