Figure 9-4 Figure 9-4 Shows the Cost and Demand Curves for a and Demand

question 229

Multiple Choice

Figure 9-4

Figure 9-4 shows the cost and demand curves for a profit-maximizing firm in a perfectly competitive market.
-Refer to Figure 9-4.If the market price is $30,should the firm represented in the diagram continue to stay in business?

• A)No, it should shut down because it is making a loss.
• B)No, it should shut down because it cannot cover its variable cost.
• C)Yes, because it is covering part of its fixed cost.
• D)Yes, because it is making a profit.

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Definitions:

Social Entrepreneurship

The use of startup companies and other entrepreneurs to develop, fund, and implement solutions to social, cultural, or environmental issues.

Enterprising Nonprofits

Nonprofit organizations that adopt business methods and practices to generate revenue for their social, environmental, or cultural missions.

Venture Philanthropy

An approach to charitable giving that applies the principles of venture capital financing to philanthropic projects, focusing on accountability, performance measurement, and long-term engagement.

Earned-Income Activities

Activities performed by non-profit organizations or businesses that generate revenue through the sale of goods and services rather than through donations.