Optimistic regarding summer sales

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Reference no: EM136275

Q. Between two production technologies firm can choose a new product line. If it installs expertise 1, it's annually costs will be C1 (q) = 3600 + 65q + 36q2. If it installs expertise 2, It'll be C2 (q) = 900 + 900q + q2.

(a) What do you mean by the rm's long-run average cost curve?
(b) What do you mean by the rm's minimum client scale of production?
(c) Illustrate expertise would the rm prefer (purely from a cost standpoint) if it expected to sell 30 units in summer as well as 10 units in winter each year?
(d) What if it were more optimistic regarding summer sales? Explain.

Reference no: EM136275

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