In economics, the difference between a firm's revenues and its costs is referred to as
A) factor payments. B) profit. C) physical capital. D) capital gains.
B
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A profit-maximizing firm will continue to expand output
a. as long as the revenues from the production and sale of an additional unit exceeds the average costs of the unit. b. until the average cost of producing the good or service is at a minimum. c. as long as the revenues from the production and sale of an additional unit exceeds the marginal cost of the unit. d. until the marginal cost of producing a good or service is at a minimum.
In the short run, the marginal cost of the first unit of output is $20, the marginal cost of producing the second unit of output is $16, and the marginal cost of producing the third unit of output is $12. The firm's total variable cost of producing three units of output is:
A. $12. B. $16. C. $20. D. $48.
Miniville is an isolated town located on the southern shore of Lake Condescending, a very large lake. The western edge of Miniville is adjacent to impassable mountains and there are no towns or businesses for many miles to the east. The 300 residents of Miniville are evenly distributed along 3 miles of shoreline on the lake, east of the mountains. Lake Shore Drive, the only street in town, provides access to Miniville's homes and businesses. All residents live between the lake and the street; businesses locate on the other side of the street. Lake Shore Drive is 3 miles long, and the points labeled A, B, and C are 1, 2, and 3 miles from the western end of Lake Shore Drive, respectively. All residents of Miniville shop at the store located closest to their homes. src="https://sciemce.com/media/4/ppg__rrr0818190951__f1q216g1.jpg" alt="" style="vertical-align: 0.0px;" height="117" width="538" />Because all residents of Miniville shop at the store located closest to their homes, the optimal location for the first store to open in Miniville is:
A. at the western end of Lake Shore Drive.
B. Point A.
C. Point C.
D. there is no single optimal location for the first store.
The fast-food industry is not considered perfectly competitive because
A. there is a small number of dominant firms. B. the firm's products are not homogeneous. C. there is a very large number of firms. D. entry and exit are strictly regulated by the government.