Which of the Following Is True for a Profit-Maximizing Firm

question 34

Multiple Choice

Which of the following is true for a profit-maximizing firm operating in a competitive market,monopolistic competition,and monopoly?

• A) Firms earn positive economic profits in the long run.
• B) Firms earn zero economic profits in the long run.
• C) Profits are maximized when marginal cost equals marginal revenue.
• D) Price equals marginal revenue.
• E) Entry into the industry is impossible.

---

Definitions:

Domestic Corporation

A corporation that is registered and operates in the same country in which it was incorporated, adhering to the legal and regulatory standards of that country.

Incorporated

Refers to the process of legally declaring a business as a separate legal entity, distinct from its owners, with rights to own property and sue or be sued.

Creature of the State

An entity that is created by and subject to state law, often used to describe municipalities or corporations.

Incorporation Statute

An Incorporation Statute is a law that outlines the process, requirements, and legal implications of forming a corporation.