Which of the Following Is Most Likely to Be Categorized

question 181

Multiple Choice

Which of the following is most likely to be categorized as an external failure cost?

• A)the cost of testing a product before shipment
• B)the cost of machinery maintenance to avoid breakdowns during production
• C)the cost of lost future sales after a customer finds a defect in a product
• D)the cost of inspection of materials to be used in production

---

Definitions:

Economic Profits

The excess amount after subtracting total expenses from total revenues, considering both explicit and implicit costs.

Demand Curves

A graph representing the relationship between the quantity of a good consumers are willing and able to purchase and its price.

Industry

A sector of the economy that produces goods, services, or related products, categorized by their business activities.