Dean Corporation Reported Net Income $58,000, Net Sales $500,000, and Average

question 26

Multiple Choice

Dean Corporation reported net income $58,000, net sales $500,000, and average assets $800,000 for 2020. The 2020 profit margin was:

• A) 5.8%.
• B) 11.6%.
• C) 62.5%.
• D) 160%.

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Definitions:

Pure Competitor

A firm in a purely competitive market that sells products identical to those of other firms, making it a price taker with no control over market price.

Pure Monopoly

A market structure where a single seller controls the entire supply of a product or service, with no close substitutes, leading to significant market power.

Profit-Maximizing Price

The price at which a company can sell its product or service to achieve the highest possible profit.

ATC

Average Total Cost, which is calculated by dividing total costs by the quantity of output produced.