Thomas Edison Once Complained That He Was Not Making a Profit

question 105

Multiple Choice

Thomas Edison once complained that he was not making a profit selling light bulbs because his plants were operating 25 percent below capacity.He estimated that he could increase output 25 percent with a 2 percent increase in the cost of production.He sold the 25 percent on the foreign market at a price below what he called the "cost of production." We can deduce that Edison really meant

• A)marginal cost was below average cost but less than marginal revenue.
• B)average cost exceeded variable cost, which exceeded marginal revenue.
• C)variable cost exceeded fixed cost but was less than marginal revenue.
• D)marginal cost was above average cost but greater than marginal revenue.

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Definitions:

Resilience

The capacity to recover quickly from difficulties; toughness.

Defense Mechanisms

Psychological strategies used unconsciously by individuals to protect themselves from unpleasant thoughts or feelings.

Coping

Utilizing conscious effort to solve personal and interpersonal problems in order to manage and minimize stress and conflict.

Denial

A psychological defense mechanism wherein a person refuses to accept the reality of a fact or situation, often as a method of coping with distress.