A Profit-Maximizing Firm That Is Operating in the Short Run

question 98

Multiple Choice

A profit-maximizing firm that is operating in the short run will sell an additional unit of output as long as:

• A) as doing so reduces the firm's per-unit costs.
• B) doing so reduces the firm's marginal costs.
• C) doing so adds more to revenue than it adds to cost.
• D) there is additional plant capacity with which to produce.

---

Definitions:

Functional

Designed to be practical and useful, rather than solely attractive, particularly in reference to objects or systems.

Usefulness

The degree to which a product, service, or information fulfills a need or purpose.

Fixed Asset

A fixed asset is a long-term tangible piece of property or equipment that a company owns and uses in its operations to generate income. Fixed assets are not expected to be converted into cash in the short term.

Physical

Pertaining to objects, materials, or substances that occupy space and have measurable properties, often contrasted with digital or virtual counterparts.