The statement that firms minimize cost means all of the following except that A) they produce the most output they can with each given level of resources B) the output they produce could not be produced using fewer resources C) firms maximize revenues D) firms are technologically efficient E) each level of output is produced in the least expensive manner

Question

Quizplus · Accepted Answer

The statement that firms minimize cost does not necessarily mean that firms maximize revenues. Maximizing revenues may involve increasing costs, such as investing in advertising or research and development to stimulate sales. The other choices (A, B, D, E) are consistent with the idea that firms minimize costs.

The Statement That Firms Minimize Cost Means All of the Following