A Firm Has a Long-Run Cost Function, C(q) = 3q²

question 10

Multiple Choice

A firm has a long-run cost function, C(q) = 3q² + 108. In the long run, this firm will supply a positive amount of output, as long as the price is greater than

• A) $72.
• B) $80.
• C) $36.
• D) $18.
• E) $41.

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Definitions:

Total Revenues

The total amount of money received by a company from its sales of goods or services before any expenses are subtracted.

Variable Costs

Costs that vary directly with the level of production or sales, like raw materials and labor.

Economic Profit

The financial gain that exceeds both the total opportunity costs of production and the accounting costs, reflecting the additional value created from business activities.