If Tamsin's Tank Tops Is a Perfectly Competitive Firm and Is

question 73

Multiple Choice

If Tamsin's Tank Tops is a perfectly competitive firm and is currently making positive economic profits of $1,000,

• A) firms will enter the market.
• B) firms will exit the market.
• C) individuals will demand more tank tops.
• D) individuals will demand fewer tank tops.
• E) the market supply curve will shift to the left.

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Definitions:

Return on Assets

This measures how efficiently a company's management is using its total assets to generate profits.

Asset Turnover

A financial ratio that measures the efficiency of a company's use of its assets to generate sales or revenue.

Average Total Assets

This metric calculates the average value of all assets owned by a company over a specific period, usually used in financial analysis to gauge productivity.

Aging Method

An accounting technique used to estimate the amount of bad debts (uncollectible accounts) by categorizing accounts receivable according to their age (how long they have been outstanding).