Which of the Following Is an Assumption That Economists Make

question 28

Multiple Choice

Which of the following is an assumption that economists make?

• A) Most people possess entrepreneurial talent.
• B) People are very good at assessing the costs of decisions accurately.
• C) Individuals and firms will act to provide the things people want.
• D) Individuals usually fail to optimize the use of their resources because they think on the margin.

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Definitions:

Accounts Payable

The amount of money a company owes to its suppliers or creditors for goods and services purchased on credit.

Return On Assets

A financial ratio indicating how profitable a company is relative to its total assets, measuring efficiency in using assets to generate earnings.

Earnings Before Interest And Taxes

A financial metric indicating the profitability of a business before accounting for interest and tax expenses.

Excess Capacity

The situation in which a facility or operation can produce more than is being demanded by its customers.