Question

Assume the demand for shirts is P = 30 – Q, and the cost per shirt is $10. Now assume that there the firm incurs an opportunity cost when it sells a shirt instead of a hat. The optimal quantity of shirts to produce will be:Assume the demand for shirts is P = 30 – Q, and the cost per shirt is $10. Now assume that there the firm incurs an opportunity cost when it sells a shirt instead of a hat. The optimal quantity of shirts to produce will be:

Answer 1

Answer:

The optimal quantity of shirts to produce will be: Less than 10

Explanation:

we know that

in MR = MC and Q = 10

opportunity increase MC, towards the lower Q when you repeat condition

MR = MC.

Answer 2

Answer:

less than 10

Explanation:

demand for shirts = P = 30 - Q

q = quantity of shirts

p = unit cost price of shirts

p =

q = $10

but optimal quantity of shirt produced after incurring opportunity cost will be

q ≤ 10

because MR = MC

and q = 10

opportunity cost causes the increase of MC( optimal quantity ) towards the lower q