Firms That Survive in the Long Run Are Usually Those

question 78

Multiple Choice

Firms that survive in the long run are usually those that

• A) become as large as possible.
• B) remain small.
• C) use more capital rather than more labor.
• D) earn the largest possible profit.

---

Definitions:

Fixed Costs

Expenses that remain constant regardless of the amount of products made or sold, including rent, wages, and insurance premiums.

Differential Analysis

A decision-making technique that involves comparing the costs and benefits of alternative actions.

Accumulated Depreciation

The total amount of depreciation expense that has been recorded against a fixed asset up to a specific date, reflecting its wear and use over time.

Salvage Value

The estimated residual value of an asset at the end of its useful life, often considered in depreciation calculations.