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So there's this question to do with microeconomics where we have a particular store selling sandwiches at $3/unit with the following production costs: enter image description here

I know that a business should produce sandwiches until the loss of continuing to operate is less than the loss caused by shutting down in the short run.

Here, the fixed cost is 20 so loss of shutting down would be 20. The answers say that this business should produce 4 sandwiches in the short run where there would be a loss of \$12-\$28=-\$16

But if the business produces 5 sandwiches, the loss would still be over -\$20, being \$15-\$33=-\$18.

Is there something I'm getting wrong with this question??

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If you had to choose between

a. losing 20 dollars
b. losing 18 dollars
c. losing 16 dollars

would you be indifferent between b. and c. because they are both better than a.?

If yes, please contact me in chat so that I can give you my bank account number for the transfer.

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    $\begingroup$ +1, but I really don’t see the need for the last paragraph $\endgroup$
    – 1muflon1 ♦
    Commented Feb 25, 2022 at 10:34
  • $\begingroup$ @1muflon1 I love drama and I am not wealthy. Also some people understand abstract decision problem concepts better if they can relate it to personal ones. $\endgroup$
    – Giskard
    Commented Feb 25, 2022 at 10:40

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