A Strategy That Achieves a Goal at the Lowest Cost

question 115

Multiple Choice

A strategy that achieves a goal at the lowest cost in total resources without consideration of who pays those costs is:

• A) efficient.
• B) inefficient.
• C) impossible.
• D) always the most profitable to the firm.

---

Definitions:

Average Variable Costs

The total variable costs of production divided by the quantity of output produced, reflecting costs that change with production levels.

Desired Profit

The target amount of money a business aims to earn over a certain period.

Fixed Costs

Expenses that do not change with the level of production or sales, such as rent, salaries, and insurance premiums.

Average Variable Cost

The total variable costs of production divided by the number of units produced, representing the variable cost per unit.