In the Long Run, a Profit- Maximizing Firm Producing a Given

question 42

Multiple Choice

In the long run, a profit- maximizing firm producing a given level of output chooses the production method that

• A) maximizes the marginal product of labour.
• B) produces that output at the lowest possible cost.
• C) maximizes the marginal product of all factors.
• D) leads to a flat total cost curve.
• E) minimizes labour input.

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Definitions:

Revenues

Revenue obtained through standard business activities, factoring in discounts and allowances for goods returned.

Earnings Per Share

Earnings per share (EPS) is a financial metric that represents the portion of a company's profit allocated to each outstanding share of common stock, serving as an indicator of a company's profitability.

Net Income

The amount of profit a company has left over after all expenses and taxes are deducted from total revenue.

Shares Outstanding

The total number of a company's shares of stock that are owned by shareholders, including restricted shares owned by the company’s officers and insiders as well as those held by the public.