Given this, what will happen to Reffland corporation’s ATC when moving from 100 to 101 pizzas?

Reffland Corporation is charging $6 per pizza in a perfectly competitive market.

Reffland Corporation is charging $6 per pizza in a perfectly competitive market.

Question

Reffland Corporation is charging $6 per pizza in a perfectly competitive market. They realize that when producing 100 pizzas, they face total fixed costs of $500 and total variable costs of $200. The next unit costs $4 to produce.

Given this, what will happen to Reffland corporation’s ATC when moving from 100 to 101 pizzas?

Reffland Corporation is charging $6 per pizza in a perfectly competitive market.


 

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