The profit motive identifies the reason why producers are trying to maximize the revenue and minimize the cost. The profit motive pushes the producers to minimize the revenue and maximize its cost. The profit motive is also the main force behind the decisions made by producers in a free-market society.
What does the profit motive pushes producers do?
So companies to maximize their profit must ensure that marginal revenue is equal to marginal cost. The company increases the profit when the last unit produced always generates an additional income greater than the additional cost when producing it, which is indicative that the production must increase.
Which best explains how revenue is determined?
Which explains how revenue is determined? The total amount of money brought in by sales is calculated.
Is the producer surplus same as the profit?
What is the difference between a producer surplus and profit? Profit is total revenues minus total costs. Conversely, producer surplus is the revenue from the sale of one item minus the marginal, direct cost of producing that item – i.e., the increase in total cost caused by that item.
Which of the following best explains what the profit motive?
The correct answer would be, The desire to make money through goods and services. Explanation: Companies earn money through their goods and services. This is the profit motive of the company.
What explains how revenue is determined?
Revenue (sometimes referred to as sales revenue) is the amount of gross income produced through sales of products or services. A simple way to solve for revenue is by multiplying the number of sales and the sales price or average service price (Revenue = Sales x Average Price of Service or Sales Price).
Which is the reason why producers try to minimize costs and maximize revenue?
Which identifies the reason why producers try to minimize costs and maximize revenue? the profit motive Which tool helps a producer set up an efficient system of production? production possibilities frontier graph Which is a market structure that can exist in a free-market system? monopolistic competition
Which is directly generates revenue for a business?
Which directly generates revenue for a business? output Which identifies the reason why producers try to minimize costs and maximize revenue? the profit motive Which tool helps a producer set up an efficient system of production? production possibilities frontier graph Which is a market structure that can exist in a free-market system?
Which is best explains why companies pay for advertising space?
Which best explains why companies pay for advertising space? expose an audience to messages about their products Which characterizes the media industry? centralization of ownership THIS SET IS OFTEN IN FOLDERS WITH… 1.06 – Different Ways to Play 20 terms InkStained 2.02 Consumers and Producers 20 terms InkStained U.S. and Global Economics: Unit 2
