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:

Stipulation

An agreement between the parties involved in a legal case on certain facts or procedures, often meant to simplify the case or expedite proceedings.

Gap-Fillers

Provisions in law or contracts that provide terms where the parties have not specified them, to complete or fill in gaps.

Materially Alter

To make significant changes to the substance or terms of an agreement or document that affect its essential elements.

Grumbling Acceptance

Accepting something reluctantly with complaints or discontent.