A Firm That Is Not Maximizing Profits

question 412

Multiple Choice

A firm that is not maximizing profits

• A) would never be able to operate in the United States.
• B) must not be owned by stockholders.
• C) may find it difficult to raise financial capital from external capital markets.
• D) is likely to face legal prosecution from the Department of Commerce.

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Definitions:

Marginal Utility

The increased gratification or utility obtained by consuming an additional unit of a good or service.

Total Utility

The total satisfaction received by a consumer from consuming a certain amount of a good or service.

Marginal Utility

The change in satisfaction or utility derived by consuming an additional unit of a good or service.

Indifference Curves

Indifference curves are graphical representations used in microeconomics to show combinations of two goods among which a consumer is indifferent, reflecting their preferences and consumption choices.