- Economists normally assume that the goal of a firm is to (i) make profit as la

ID: 1228574 • Letter: #

Question

- Economists normally assume that the goal of a firm is to

(i) make profit as large as possible even if it means reducingoutput.

(ii) make profit as large as possible even if it means incurringa higher total cost.

(iii) make revenue as large as possible.

a. (i) and (ii) are true.

b. (i) and (iii) are true.

c. (ii) and (iii) are true.

d. (i), (ii), and (iii) are true.

a. the cost of forgone labor earnings for an entrepreneur.

b. the lost opportunity to invest in capital markets when themoney is invested in one's business.

c. lease payments for the land on which a firm’s factorystands.

d. Both a and c are correct.

a. fixed costs and variable costs.

b. fixed costs and marginal costs.

c. variable costs and marginal costs.

d. average costs and marginal costs.

a. marginal costs.

b. average costs.

c. fixed costs.

d. incurred costs.

a. have a negligible impact on the market price.

b. have little effect on overall production but will ultimatelychange final product price.

c. cause a noticeable change in overall production and a changein final product price.

d. adversely affect the profitability of more than one firm inthe market.

2.C 3.D 4.C 5..C.

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