[1 mark Q26.
A reduction in the market price of a firm's product will always result in an increase in its
profits or a reduction in its losses if it
A
increases its share of the market.
increases its total revenue by more than its total
costs.
B
с
enables it to reduce its average costs.
D
leads to a reduction in the price of its inputs.
[1 mark]
Q27.
The diagram below shows a firm's average total cost curve (ATC), with the firm

Assume that a local bank sells two services, checking accounts and atm card services. the bank’s only two customers are mr. donethat and ms. beenthere. mr. donethat is willing to pay $8 a month for the bank to service his checking account and $2 a month for unlimited use of his atm card. ms. beenthere is willing to pay only $5 for a checking account, but is willing to pay $9 for unlimited use of her atm card. assume that the bank can provide each of these services at zero marginal cost.refer to scenario 17-5. if the bank is unable to use tying, what is the profit-maximizing price to charge for a checking account