Profit Answers

In order to calculate marginal cost, producers must compare the difference in the cost of producing one unit to the cost of

A

purchasing a unit.

B

distributing that unit.

C

producing the next unit.

D

producing a different unit.

2

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What is the best definition of marginal cost?

A

the possible income from producing an additional item

B

the price of producing one additional unit of a good

C

the additional income gained from selling an additional good

D

the financial gain from business activity minus expenses

3

The chart shows the marginal revenue of producing apple pies.According to the chart, the marginal revenue

A

decreases by ten dollars as production increases.

B

increases by ten dollars as production increases.

C

falls to zero dollars as production increases.

D

remains the same as production increases.

4

Brenda’s Boards manufactures skateboards. Each skateboard sells for $45 and includes the following expenses: $3 for the wheels and mounts, $1 for the plastic board, $1 for the paint, and $10 for the labor. What is the total revenue the company makes after selling 10 boards?

A

$300

B

$350

C

$400

D

$450

5

Brenda’s Boards manufactures skateboards. Each skateboard sells for $45 and includes the following expenses: $3 for the wheels and mounts, $1 for the plastic board, $1 for the paint, and $10 for the labor. What is the total profit the company earns after selling 100 boards?

$

$300

$

$350

$

$3,000

$

$3,500

6

To generate higher profits, producers must work to

i

increase their total supply.

i

increase their total expenses.

d

decrease their customer base.

d

decrease their production costs.

7

What is the best definition of marginal benefit?

A

the possible income from producing an additional item

B

the price of producing one additional unit of a good

C

the additional income gained from selling an additional good

D

the financial gain from business activity minus expenses

8

The Davis family grows organic vegetables to sell at a local farmer’s market. Which are factors that directly affect their profit? Check all that apply.

A

an increase in the cost of farm equipment

B

a rise in demand for organic produce

C

an increase in customers at the market

D

a change in the market price for non-organic fruit

E

a sale on organic meats at the market

9

What is the difference between profit and revenue?

R

Revenue is the total amount producers receive after selling a good. Profit is the total amount producers earn after subtracting the production costs.

R

Revenue is the total amount producers earn after subtracting the production costs. Profit is the total amount producers receive after selling a good.

R

Revenue is the total amount producers pay to manufacture a good. Profit is the total amount producers earn after subtracting the production costs.

R

Revenue is the total amount producers pay to manufacture a good. Profit is the total amount producers receive after selling a good.

10

The point of maximum profit is the point at which the marginal cost equals the

A

marginal revenue.

B

market price.

C

total revenue.

D

production cost.

11

[BLANK]

A

debts

B

profits

C

expenses

D

costs

12

Producers must understand the marginal benefit of making an additional unit, which shows the

A

actual gain.

B

eventual gain.

C

possible gain.

D

unlikely gain.

13

Brenda’s Boards manufactures skateboards. Each skateboard sells for $45 and includes the following expenses: $3 for the wheels and mounts, $1 for the plastic board, $1 for the paint, and $10 for the labor. What is the total revenue the company makes after selling 10 boards?

A

$300

B

$350

C

$400

D

$450

14

In order to calculate marginal cost, producers must compare the difference in the cost of producing one unit to the cost of

A

purchasing a unit.

B

distributing that unit.

C

producing the next unit.

D

producing a different unit.

15

What is the best definition of marginal benefit?

A

the possible income from producing an additional item

B

the price of producing one additional unit of a good

C

the additional income gained from selling an additional good

D

the financial gain from business activity minus expenses

16

What is the difference between profit and revenue?

A

Revenue is the total amount producers receive after selling a good. Profit is the total amount producers earn after subtracting the production costs.

B

Revenue is the total amount producers earn after subtracting the production costs. Profit is the total amount producers receive after selling a good.

C

Revenue is the total amount producers pay to manufacture a good. Profit is the total amount producers earn after subtracting the production costs.

D

Revenue is the total amount producers pay to manufacture a good. Profit is the total amount producers receive after selling a good.

17

The chart shows the marginal revenue of producing apple pies.According to the chart, the marginal revenue

A

decreases by ten dollars as production increases.

B

increases by ten dollars as production increases.

C

falls to zero dollars as production increases.

D

remains the same as production increases.

18

The point of maximum profit is the point at which the marginal cost equals the

A

marginal revenue.

B

market price.

C

total revenue.

D

production cost.

19

Brenda’s Boards manufactures skateboards. Each skateboard sells for $45 and includes the following expenses: $3 for the wheels and mounts, $1 for the plastic board, $1 for the paint, and $10 for the labor. What is the total profit the company earns after selling 100 boards?

A

$300

B

$350

C

$3,000

D

$3,500

20

What is the best definition of marginal cost?

A

the possible income from producing an additional item

B

the price of producing one additional unit of a good

C

the additional income gained from selling an additional good

D

the financial gain from business activity minus expenses

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