Figure 14-7 -Refer to Figure 14-7. in the Long Run, the Firm

question 227

Multiple Choice

Figure 14-7
-Refer to Figure 14-7. In the long run, the firm will exit the market if the price of the good is

• A)$75.
• B)$85.
• C)$95.
• D)All of the above are correct.

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Definitions:

Incremental Choices

Decisions made by comparing the additional benefits and costs of a little more or a little less of some activity.

Margin

In finance, the difference between the selling price and the cost of the goods sold, often expressed as a percentage of sales.

Economic Activity

The actions that involve the production, distribution, and consumption of goods and services in an economy.

Marginal Analysis

An examination of the benefits and costs of one additional unit of change.