Defense Contractors Would Be More Likely to Use Which of the Following

question 4

Multiple Choice

Defense contractors would be more likely to use which of the following cost concepts in pricing their product?

• A) Variable cost
• B) Product cost
• C) Total cost
• D) Fixed cost

---

Definitions:

Long-Run Total Cost

Refers to the total cost incurred by a firm in producing a given output when all inputs, including both fixed and variable costs, are considered over a longer period.

Maximize Profits

A rephrased definition for Profit-Maximizing; aiming to achieve the maximum possible profits through optimal production and sales strategies.

Total Cost

The entire cost of production for a business, including both fixed (unchanging with output) and variable (changing with output) expenses.

Long-Run

A period in economics during which all factors of production and costs are variable, allowing all inputs to be adjusted to change the level of output.