It Is Possible for a Competitive Firm That Is Maximizing

question 249

True/False

It is possible for a competitive firm that is maximizing profits in the short run to make its profits even bigger in the long run by expanding its plant, assuming that the product price stays the same.

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Definitions:

Equipment

Tangible assets used in operations, such as machinery and computers, that have a useful life beyond one year.

Owner's Equity

The residual interest in the assets of an entity after deducting liabilities, representing the ownership interest of shareholders or owners.

Balance Sheet

A balance sheet is a financial statement that reports a company’s assets, liabilities, and shareholders' equity at a specific point in time, offering a basis for computing rates of return and evaluating its capital structure.

Assets

Resources owned or controlled by a business or an individual that are expected to produce future economic value.