When a Firm Earns a Rate of Return on an Investment

question 12

Multiple Choice

When a firm earns a rate of return on an investment that _____,it makes a pure economic profit.

• A)is above its accounting costs
• B)is equal to its average variable cost
• C)is above the cost of borrowed funds
• D)just covers the firm's fixed costs

---

Definitions:

Feedback

Responses or information about reactions to a product, a person's performance, or a process, which is used for improvement.

Information-gathering

The process of collecting data and insights from various sources for analysis, decision-making, or research purposes.

Identifying

The act of recognizing or distinguishing the characteristics or features of a person, object, or concept.

Interview

A formal meeting in which one or more persons consult, question, or evaluate another person.