Question:
Suppose a firm sells its product at a price lower than the opportunity cost of the inputs used to produce it. Which is true?
| A. |
The firm will earn accounting and economic profits. |
B. |
The firm will face accounting and economic losses. |
C. |
The firm will face an accounting loss, but earn economic profits. |
D. |
The firm may earn accounting profits, but will face economic losses. |
Answer» d. The firm may earn accounting profits, but will face economic losses. |
Note: |
The above multiple-choice question is for all general and Competitive Exams in India. |