Use the Following Information to Answer Questions 33 - 35

question 7

Multiple Choice

Use the following information to answer Questions 33 - 35
Sarah's Machinery Company is deciding to dump their current technology A for a new technology B with small fixed costs but big marginal costs.The current technology has fixed costs of $500 and marginal costs of $50 whereas the new technology has fixed costs of $250 and marginal costs of $100.
-If the company plans to produce 9 machines,which technology should the firm choose?

• A)The low-marginal-cost technology
• B)The high-marginal-cost technology
• C)Either technology because they are equally cost efficient
• D)Need more information

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Definitions:

Short Run

The period in economic theory during which at least one factor of production is considered fixed.

Long Run

A period in which all factors of production can be varied, and no inputs are fixed.

Demand Inelasticity

A situation where the demand for a product does not change significantly with a change in its price.

Wendy's Hamburgers

A popular fast-food chain known for its burgers, recognized for its square hamburger patties.