SELECT ALL THAT APPLY

question 42

Multiple Choice

SELECT ALL THAT APPLY. If decision makers are assumed to be rational actors, which of the following assumptions holds?

• A) They have preset goals or preferences.
• B) They select the course of action that maximizes their goals and minimizes costs.
• C) They calculate costs and benefits mostly in material terms.
• D) They act as a composite of multiple actors, engaging in bargaining and trade-offs.

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Definitions:

Perfectly Competitive

A market structure where many firms sell identical products, entry and exit are easy, and no single seller can influence the market price.

Marginal Cost

The increase in total cost that arises from producing one additional unit of a good or service.

Total Revenue

The total amount of income generated by the sale of goods or services before any expenses are subtracted.

Nash Equilibrium

A situation in game theory where each player’s strategy is optimal given the strategies of all other players, resulting in a stable outcome.