Select the Correct Statement Regarding Relevant Costs and Revenues

question 19

Multiple Choice

Select the correct statement regarding relevant costs and revenues.

• A) Relevant costs are also known as unavoidable costs.
• B) Relevant costs are only those that are based on past experience.
• C) Relevant revenues must differ among the alternatives.
• D) All of these answers are correct.

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Definitions:

Long-run Economic Profits

Profits that occur when a firm's total revenue exceeds its total costs, including both explicit and implicit costs, over the long term.

Threat Of New Entrants

The potential challenge posed by a new competitor entering an industry or market.

Contestable

Pertaining to a market situation where costs of entry and exit are low, allowing for potential competition to exist even if the market is held by a few companies.

Competitive Level

indicates the intensity of competition within a market, influencing firms' strategies and market outcomes.