If Gary's Gym is earning a positive economic profit, what can we infer about its pricing strategy in relation to average total cost?

If Gary's Gym is earning a positive economic profit, it means that the revenue from its services is greater than the total costs of running the gym, including both fixed and variable costs. This suggests that the price at which Gary's Gym is selling its memberships or services is higher than the average total cost of providing those services. For example, if the gym charges $100 per month for a membership, and the average total cost to serve each member is $80, then the gym is making a profit of $20 per member. This pricing strategy indicates that the gym has a competitive advantage, possibly due to unique features or high demand, allowing it to charge more than what it costs to operate. Overall, a positive economic profit shows that the gym is successfully attracting customers while efficiently managing its costs.