Economists Explicitly Assume That the Primary Objective of Firms Is

question 175

Multiple Choice

Economists explicitly assume that the primary objective of firms is to maximize

• A) sales.
• B) market share.
• C) shareholder wealth.
• D) profits.

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Definitions:

Efficiency Loss

The loss of economic efficiency that can occur when equilibrium for a good or a service is not achieved or is not achievable.

Deadweight Loss

Deadweight loss is an economic inefficiency resulting from a disparity between supply and demand, often caused by market interventions like taxes or price controls, resulting in potential benefits not realized by any party.

Tax Revenue

The total amount of money collected by the government from taxes, which is then used for public expenditures.