Long-Run Total Cost Is the Maximum Economic Cost of Producing

question 72

True/False

Long-run total cost is the maximum economic cost of producing each possible level of output when the time period is sufficiently long to change all inputs of the firm's production function.

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Definitions:

Firm's Total Profit

The total income of a firm after subtracting all costs necessary to generate its revenue.

Firm's Total Profit

The total income of a firm after subtracting all costs from its total revenues.

Profit Maximizing

The process of adjusting production and sale levels to achieve the highest possible profit based on existing market conditions.

Level of Output

The quantity of goods or services produced by a company, industry, or economy within a given period.