I’maGoldMiner has benefited from a record rise in gold prices in the global commodities market. While the price of its output is highly influenced by market speculation, if it wants to increase production to take advantage of the current profit-maximizing opportunity, the company
A. must accept market price for its physical capital inputs.
B. must reduce what it pays for inputs that make up its costs of production.
C. must reduce production to encourage speculators to drive gold prices higher.
D. must alter the price of its labor inputs to maximize profits.
Answer:A
I’maGoldMiner has benefited from a record rise in gold prices in the global commodities market. While the price of its output is highly influenced by market speculation, if it wants to increase production to take advantage of the current profit-maximizing opportunity, the company
A. must accept market price for its physical capital inputs. B. must reduce what it pays for inputs that make up its costs of production. C. must reduce production to encourage speculators to drive gold prices higher. D. must alter the price of its labor inputs to maximize profits.
Explanation: Category: Analyze