Which of the Following Statements Is True

question 12

Multiple Choice

Which of the following statements is true?

• A)Economic profits ignore implicit costs and revenues.
• B)Although implicit costs do not show up in accounting profits,they nevertheless affect managerial decisions.
• C)Although explicit costs do not show up in accounting profits,they nevertheless affect managerial decisions.
• D)Economists consider sunk costs in their decision making

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Definitions:

Cost of Producing

The total expenses incurred in the manufacture of a product, including raw materials, labor, and overhead costs.

Orange Grower

An individual or business involved in the cultivation of orange trees for the purpose of fruit production.

Production Function

A mathematical relationship describing the maximum output that can be produced with a given set of inputs, such as labour and capital, under certain conditions.

Production Function

An economic model expressing the relationship between inputs used in production and the resulting output, illustrating how input changes affect output levels.