Quizlet Business Economics

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  1. All firms will maximise profit if they: produce at a point which marginal cost equals marginal revenue when marginal cost is rising
  2. Cost minimised level: is when marginal cost equals average total cost
  3. Diminising returns will always occurs: because fixed factors of production such as land, machinery or buildings will all have a maximum possible output
  4. if the firm moves beyond optimum level of production: output will fall and the only way of increasing output is buying, purchasing extra fixed factors of production and moving into long run
  5. In short term, output can only be increase: by applying extra variable factors of production
  6. The firms optimum level of production is: when total products is maximised and at this point marinal product is zero
  7. The objective of all businesses: is to maximise level of profit as the owners of businesses will wish to maximisedthe returns on their investment.