Use the Fact Situation in Q2 to Answer the Related

question 19

Multiple Choice

Use the fact situation in Q2 to answer the related question that follows. The type of business that A and B are setting up is called

• A)wholesale sales.
• B)electronic retailing.
• C)retail sales.
• D)e-commerce.
• E)digital retailing.

---

Definitions:

Total Surplus

The total net gain for society from producing and consuming a good, encapsulated by the addition of consumer surplus and producer surplus.

Profit Maximization

The technique a firm applies to set the price and production level for the best profit return.

Price

The sum of money needed to buy a product, service, or asset.

Quantity

The quantity of a tangible or intangible product or service.