Which of the Following Is True of Profits and Losses

question 51

Multiple Choice

Which of the following is true of profits and losses?

• A) Profits direct entrepreneurs toward production of goods that are highly valued relative to their cost, while losses direct them away from wealth-reducing activities.
• B) Profits indicate that the firm is charging prices that are too high, while losses indicate that the firm needs to raise its prices.
• C) Profits indicate that the consumer is getting a bad deal, while losses indicate that the consumer values the product highly relative to its cost.
• D) Profits indicate that the suppliers of resources are underpaid, while losses indicate they are overpaid.

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Definitions:

Behavior

The actions or reactions of an object or organism, usually in relation to the environment.

Person

An individual human being, characterized by unique physical, psychological, and social attributes.

Observable

Qualities, actions, or reactions that can be noticed or measured by someone else through direct visual perception or using scientific tools.

Action

The process or state of acting or doing something, typically to achieve a goal or purpose.