The Break-Even Point Is

question 47

Multiple Choice

The break-even point is:

• A) always calculated from the difference between average cost and average revenue in the short run
• B) always calculated from the difference between total costs and total revenues in the short run
• C) always calculated from the difference between average fixed cost and average revenue in the short run
• D) always greater than the shut-down point in the short run

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Definitions:

Economic Efficiency

A state in which resources are allocated in a way that maximizes the production of goods and services at the lowest cost, while achieving the highest possible welfare or utility.

Negative Externalities

Costs experienced by third parties due to the actions of others that are not reflected in market prices.

Clayton Act

A U.S. antitrust law, adopted in 1914, aimed at protecting competition by prohibiting certain actions that lead to anticompetitiveness.

Celler-Kefauver Act

A U.S. law enacted in 1950 to amend the Clayton Act, aiming to prevent anti-competitive mergers and acquisitions by prohibiting the acquisition of assets if the effect reduces competition.