Profits and Losses Are TRUE Signals Because They

question 30

Multiple Choice

Profits and losses are TRUE signals because they

• A) convey information about true long-run profits.
• B) cannot be misinterpreted by entrepreneurs.
• C) convey information about where to place resources and reward people who act on the information.
• D) reward people who make profits with even more profits and punish those who make losses with even more losses.

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Definitions:

Temperature

A measure of the hotness or coldness of a body or environment, indicative of the level of kinetic energy of particles in the object or the air.

Laryngeal Mirror

A medical instrument with a small, reflective surface used to view the larynx (voice box) and surrounding areas during an examination.

Mouth

The opening in the face of a person or animal, used for eating, breathing, and vocalization; part of the digestive system.

Dust

Fine particles of matter often consisting of tiny fragments of fiber, soil, and skin cells, which can accumulate on surfaces or become airborne.