A Firm Sells Small-Ticket Items to Their Regular Customers on Customer

question 88

Multiple Choice

A firm sells small-ticket items to their regular customers on customer charge accounts and then bills the customers each month.This type of credit arrangement is called:

• A)trade credit.
• B)charge account credit.
• C)installment credit.
• D)debit card credit.

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Definitions:

Marginal Cost

The cost of producing one additional unit of a product or service, crucial for economic decision-making and pricing strategies.

Marginal Revenue

Additional earnings received from marketing one more unit of a good or service.

Perfect Competitor

A theoretical market structure where many firms sell identical products, entry and exit are free, and no single buyer or seller can influence the market price.

Long Run

A period in which all factors of production and costs are variable, allowing firms to adjust all inputs.