Figure 13-5 -Refer to Figure 13-5.The Candy Store Represented in the Diagram

question 229

Multiple Choice

Figure 13-5
-Refer to Figure 13-5.The candy store represented in the diagram is currently selling Qa units of candy at a price of Pa.Is this candy store maximizing its profit and if it is not,what would you recommend to the firm?

• A)Yes,it is maximizing its profit by charging the highest price possible.
• B)No,it is not;since its marginal cost is constant,it should produce and sell as much candy as it can.It should sell Qd units at a price of Pd.
• C)No,it is not;it should lower its price to Pc and sell Qc units.
• D)No,it is not;it should lower its price to Pb and sell Qb units.

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Definitions:

Order

A request made by a customer for a specific product or service, initiating a transaction between buyer and seller.

Reseller Objection

Resistance or concerns expressed by a reseller or distributor, often related to product price, features, market demand, or terms of sales agreements.

Loyalty

The quality of being faithful or committed to a brand, company, or product, often resulting from customer satisfaction.

Dodge Technique

A strategy used in discussions or negotiations to avoid directly answering a question or addressing a challenging issue.