Assume You Are in the Business of Producing and Selling

question 228

Multiple Choice

Assume you are in the business of producing and selling t-shirts. If you could produce more t-shirts with the same input, what would happen to your productivity and profits assuming the price of your t-shirts remains the same?

• A)increase in productivity, decrease in profits
• B)increase in productivity, increase in profits
• C)decrease in productivity, decrease in profits
• D)decrease in productivity, increase in profits

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Definitions:

Quantity And Prices

The relationship in economics between the quantity of goods available (supply) and the price those goods fetch in the market (demand).

Higher Profits

An increase in the amount of money that is left after all operating expenses, taxes, and costs have been subtracted from total revenue.

Resource Suppliers

Entities or individuals that provide the essential inputs required for the production of goods or services.

Allocation Of Resources

Allocation of resources refers to the process of distributing available resources among various competing needs and uses in an economy to maximize efficiency and welfare.