Which of the Following Is Most Likely to Be True

question 80

Multiple Choice

Which of the following is most likely to be true of economic and accounting profits?

• A) Economic profits are less than accounting profits.
• B) Accounting profits are less than economic profits.
• C) Economic profits plus accounting profits equal zero.
• D) Accounting profits minus economic profits equal zero.

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Definitions:

Price Elasticity

Measures the responsiveness or sensitivity of the quantity demanded for a product to a change in its price.

Normal Good

A good for which demand increases as the income of the consumer increases.

Aggregate Demand

The total demand for all goods and services within a specific economy at a given overall price level and in a given time period.

Income Distribution

Refers to the way total personal income is distributed among individuals or households in an economy, affecting economic inequality.