According to the Spotlight on Small Business Box, Small Businesses

question 15

Multiple Choice

According to the Spotlight on Small Business box, small businesses can make big money by

• A) participating in mass production.
• B) jumping on board with technological advances as they evolve.
• C) shipping products to consumers faster than competitors.
• D) opening online stores to accompany the already established brick-and-mortar shops.

Evaluate decision-making processes in operational and financial contexts.

Understand the concept of average cost and how it is affected by changes in the quantity of units produced and workers hired.

Learn about the relationship between marginal cost (MC), marginal revenue (MR), and their impact on hiring and production decisions.

Comprehend the definition and calculation of total costs (TC), including the distinction between fixed costs (FC) and variable costs (VC).

---

Definitions:

Total Cost

The sum of all expenses incurred in the production of goods or services, including both fixed and variable costs.

Total Revenue Curve

A graphical representation showing how a firm's total revenue changes with variations in the quantity of goods or services sold.

Price-Taking Behavior

The action of accepting the market price as given, typical of participants in a perfectly competitive market who cannot influence prices.

Slope

The measure of the steepness or incline of a line, calculating the ratio of the vertical change to the horizontal change between two points on the line.