Firms Will Make a Profit in the Long Run or Short

question 117

Multiple Choice

Firms will make a profit in the long run or short run if the price is:

• A)equal to marginal revenue.
• B)greater than ATC.
• C)less than MC.
• D)greater than AVC.

---

Definitions:

Net Unrealized Gains/Losses

Represents the difference between the current market value of held investments and their original purchase prices, not yet realized through sales.

Equity Method

An accounting technique used to record investments in which the investor has significant influence over the investee but does not have full control.

Carrying Value

The book value of an asset or liability on a company's balance sheet, calculated as the asset's original cost minus accumulated depreciation, amortization, or impairment charges.

Investment Income

Income earned from investments such as dividends on stocks, interest on bonds, or rental income from property.