One Way a Company Can Cover Its Costs And,at the Same

question 370

Multiple Choice

One way a company can cover its costs and,at the same time,obey a marginal cost pricing rule is by

• A) choosing output levels according to the profit-maximizing rule.
• B) using price discrimination.
• C) increasing production.
• D) decreasing production.
• E) decreasing its marginal cost but not changing its average total cost.

---

Definitions:

Actual Borrowings

Actual borrowings refer to the actual amount of funds a company or individual has borrowed from lenders or financial institutions, as opposed to planned or potential borrowing amounts.

Capitalize

The process of recording an expenditure as an asset, rather than an expense, thus spreading the cost over its useful life.

Construction Loan

A short-term loan provided to finance the building of a property or real estate project, with the property itself usually serving as collateral.

Interest-bearing Debt

A type of debt that incurs interest expenses over the loan period.