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Production Decision for a Gadget Manufacturer
A company that manufactures smart widgets is currently producing 5,000 units per week. The marketing department reports that selling one more widget (the 5,001st) would increase total revenue by $75. The production department calculates that the cost of producing this additional widget would be $60. Should the company increase its production to 5,001 units? Justify your answer based on the effect on total profit.
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Production Decision for a Gadget Manufacturer
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