An organization whose capacity is on the portion of the average unit cost curve that increases as output rises: has a facility that is below optimum operating level and should build a larger facility. has utilization higher than efficiency. is enjoying economies of scale. has a facility that is at optimum operating level. has a facility that is above optimum operating level and should reduce facility size.

Until recently, hamburgers at the city sports arena cost $4.70 each. the food concessionaire sold an average of 13 comma 000 hamburgers on game night. when the price was raised to $5.40, hamburger sales dropped off to an average of 6 comma 000 per night. (a) assuming a linear demand curve, find the price of a hamburger that will maximize the nightly hamburger revenue. (b) if the concessionaire had fixed costs of $1 comma 500 per night and the variable cost is $0.60 per hamburger, find the price of a hamburger that will maximize the nightly hamburger profit.