In constructing a short-run aggregate supply curve,we assume that the goal of business is to:
A)maximize sales revenue.
B)maximize profit.
C)maximize growth in assets.
D)maximize growth in sales.
E)minimize cost.

Question

Quizplus · Accepted Answer

In constructing a short-run aggregate supply curve, we assume that businesses aim to maximize profit in the short-run. This is because the short-run assumes that firms have a fixed level of capital and technology, and therefore they seek to optimize their output levels so as to maximize their profits at the given level of input costs.

In Constructing a Short-Run Aggregate Supply Curve,we Assume That the Goal