If a Firm Sells Its Output at a Price Greater

question 163

True/False

If a firm sells its output at a price greater than AVC, it will earn economic profit.

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Definitions:

Liabilities

Financial obligations or debts of a business that are due to be paid to creditors in the future.

Accounting Equation

The foundational principle in accounting that states assets equal liabilities plus shareholders' equity.

Profitable

Refers to a financial state where income exceeds expenses, resulting in a positive gain.

Accounting Equation

The foundation of double-entry bookkeeping, which asserts that assets equal the sum of liabilities and shareholders' equity.