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:

Age of Majority

The legally defined age at which a person is considered an adult and is granted the full legal rights and responsibilities of adulthood.

Legal Position

The stance or standpoint taken by a party on legal matters, based on rights, laws, and responsibilities.

Infant

A minor or young child, especially one below the age of legal adulthood.

Binding on Infants

The legal principle that certain contractual agreements, despite involving minors (infants under the law), are enforceable against them, typically involving necessities or education.