Which of the Following Defines Profit Satisficing

question 25

Multiple Choice

Which of the following defines profit satisficing?

• A) when profits are the only objective of a firm
• B) where satisfactory profits are insufficient
• C) when a firm is unable to maximise profits and so simply accepts whatever profit level it can achieve
• D) where decision makers in a firm aim to for a target level of profit rather than the absolute maximum level

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Definitions:

Average Total Costs

The sum of all production costs divided by the quantity of output produced, representing the per-unit cost of production.

Average Variable Cost

The total variable costs (costs that change with output level) of production divided by the quantity of output produced.

Fixed Costs

Fixed costs are business expenses that remain unchanged regardless of the level of goods or services produced, such as rent, salaries, and insurance premiums.

Variable Cost

Costs that vary directly with the level of production or sales, such as raw materials and labor expenses.