The Behavior of Profit-Maximizing Producers Is Guided by

question 25

Multiple Choice

The behavior of profit-maximizing producers is guided by

• A)Philanthropy.
• B)Self-interest.
• C)Aesthetic concerns.
• D)Social costs.

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Definitions:

LIFO Inventory Method

An accounting method that assumes the last items of inventory purchased are the first to be used or sold, affecting the cost of goods sold and inventory valuation.

FIFO Inventory Method

An accounting method for valuing inventory that assumes the first items purchased are the first ones sold.

Ending Inventory

The total value of all inventory that a company has in stock at the end of an accounting period.

Decreasing Unit Costs

A situation in which costs per unit of output fall as the volume of production increases, often due to economies of scale.