Answer:
I would advise Mr. Raiman to reduce the quantity of output produced.
Explanation:
Mr. Raiman produces 12 pairs of shoes per week.
The marginal cost incurred in producing the 12th pair is $84.
The marginal revenue earned from the 12th pair is $70.
The marginal cost is greater than marginal revenue. This means that Mr. Raiman is having a loss.
In order to maximize profits, he should produce at the point where the marginal cost is equal to marginal revenue.
So, I would suggest him to reduce the output to the level where marginal cost is equal to marginal revenue.
