-Refer to Figure 4

question 13

Multiple Choice

-Refer to Figure 4.1, the increase in output from point B to C is greater than the increase in output from point C to D because

• A)more workers always produce more.
• B)better workers are usually hired after the earlier ones.
• C)a small number of workers cannot take as good advantage of the division of labor as a larger number.
• D)eventually workers are up against the fact that there are fixed inputs and more workers do not add as much.

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Definitions:

Economic Profit

The difference between total revenue and total costs, including both explicit and implicit costs, measuring the true profitability of a firm.

Profit-Maximizing

A method or strategy businesses use to achieve the highest possible profit from their operations.

Perfectly Competitive

Refers to a market structure where many firms sell identical products, and there are no barriers to new firms entering the market.

Market Price

The prevailing market price for buying or selling an asset or service currently.