Economic Profit?
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49
Which is the following is true regarding Economic Profit?
a. Marginal revenue received from the sale of an output less marginal costs of all inputs used.
b. Revenue received from the sale of an output and the costs of all inputs used.
c. Revenue received from the sale of an output and the costs of all Inputs used and any opportunity costs.
d. Revenue received from the sale of an output and the variable cost of all inputs used.
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- What concept relates to the proportionate savings in costs gained when levels of production are increased: A) Accounting profit. B) Economies of scale. C) Marginal costs. D) Barriers to entry. E) Economic profit. The benefit lost when choosing one option precludes receiving the benefits from an alternative option was referred to as: A) Irrelevant costs. B) Lost costs. C) Alternative costs. D) Opportunity costs. E) Sunk costs.1) Cost-volume relationship states that maximum profit is reached by maximizing revenue. Select one: True O FalseConsider the following two statements concerning cost-volume-profit analysis. (1) The contribution per unit is the difference between the sales price per unit and the fixed costs per unit. (2) The marginal cost per unit will usually equal the variable cost per unit. Which one of the following combinations ( true/false) relating to the above statements is correct?
- (Variable cost = Total cost - Fixed cost - Net profit) you have not consider the net profit in the calculation. I think it should be added right ?The mathematical equation for computing required sales to obtain target net income is: Required Sales Revenue = a. Total Fixed Costs + Target Net income b. Total Variable Costs + Total Fixed Cost + Target Net Income c. Total Contribution – Total Fixed Costs d. Total Variable Costs + Target Net IncomeThe formula for Contribution is Select one: a. Fixed cost + loss b. Sales - Variable cost c. Fixed cost - Profit d. Sales + Variable cost
- 2. What is cost-volume-profit analysis and what are the important assumptions of this analysis?Which of the following statement is correct for relevant costs? a.It is avoidable, future and measured by cash b.It is avoidable, future and measured by profit c.It is unavoidable, future and measured by cash d.It is unavoidable, future and measured by profitThe difference, (Total Revenue - Total Cost) or [(Unit Price x Quantity Sold) - (Fixed Cost + Variable Cost)], represents, O the break-even point O the profit equation O the sales ratio O the market share O the value equation