B Harper Is Surfing the Internet and Finds a Great

question 95

Multiple Choice

B Harper is surfing the Internet and finds a great pair of rollerblades at a really low price.He has never heard of the company and is concerned that the product he ordered may not be the product he receives.Harper may be more willing to place an order with this company if

• A) The website displays the WebTrust seal.
• B) The company provides its annual report and the report of the independent auditors on its website.
• C) The company provides a money-back guarantee.
• D) Only a partial payment is required prior to receiving the product.

---

Definitions:

Marginal Revenue

The increase in revenue resulting from the sale of one additional unit of output.

Profit-Maximizing

The process or strategy of adjusting production and pricing to achieve the highest possible profit within a market.

ATC

Average Total Cost; this refers to the total cost per unit of output incurred when producing goods or services.

Long-Run Equilibrium

A state in market conditions where all firms in a perfectly competitive industry earn zero economic profit, leading to the optimal distribution of resources in that industry.