Only Undertaking an Activity When It Adds More to Revenue

question 169

Multiple Choice

Only undertaking an activity when it adds more to revenue than to cost is the decision rule a profit-maximizing firm will use when deciding upon

• A) the level of output to produce.
• B) the amount of advertising to undertake.
• C) the level of product quality (for example, how many years it is designed to last).
• D) all of the above.

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Definitions:

Propanal

An organic compound with the formula CH3CH2CHO, a type of aldehyde that is used as an intermediate in organic synthesis.

Butanal

An aldehyde with the formula C4H8O, it is a four-carbon chain compound with a carbonyl group attached to the first carbon.

NaOH

Sodium hydroxide, a caustic alkali commonly used in many industrial and laboratory processes, known for its strong base characteristics.

Benzophenone

An aromatic ketone with the formula C13H10O, used as a photo initiator in polymer chemistry and as a flavoring agent.