Use the Following to Answer Question

question 171

Multiple Choice

Use the following to answer question:
Figure: The Market for Gas Stations
-(Figure: The Market for Gas Stations) Use Figure: The Market for Gas Stations.The figure shows curves facing a typical gas station in a large town.The market is characterized by many firms,differentiated products,easy entry,and easy exit.If the gas station shown here were to raise its price above the profit-maximizing price,the outcome would be _____ in total revenue.

• A)a reduction
• B)an increase
• C)no change
• D)Not enough information is given to answer the question.

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Definitions:

Factory Overhead Allocation

The process of distributing the indirect costs of manufacturing across the products produced, such as utilities or maintenance of equipment.

Product Mix

A combination of different products that a company manufactures or sells.

Product Price

The amount of money charged for a product or service, set by the seller.

Production Department

The production department is a segment within a manufacturing company responsible for the processes and activities related to producing the company's products.