A basic tenet of the theory of the firm is that the firm's primary objective is to
A) stay out of debt.
B) produce a given level of output at a specified cost.
C) maximize economic profits.
D) operate for the benefit of society.
C
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Refer to the scenario above. What will the outcome of this game be?
A) Both players will choose black. B) Both players will choose white. C) Arthur will choose white and Catherine will choose black. D) Catherine will choose white and Arthur will choose black.
A Pigovian tax is a tax:
A. meant to counter the effect of a negative externality. B. that increases efficiency in a market. C. that increases total surplus in a market. D. All of these statements are true.
A perfectly inelastic demand implies that buyers
a. decrease their purchases when the price rises. b. purchase the same amount as before when the price rises or falls. c. increase their purchases only slightly when the price falls. d. respond substantially to an increase in price.
The process of accumulation that occurs when interest is paid on previously earned interest is called:
A. backdating. B. compounding. C. present valuation. D. front loading.