It is assumed in standard economic theory that a firm makes decisions in an effort to
A) become as large as possible.
B) have a highly diversified product.
C) maximize its profits.
D) maximize its revenue.
E) be favoured politically.

Question

Quizplus · Accepted Answer

Standard economic theory assumes that the ultimate goal of a firm is to maximize its profits. This means that a firm will make decisions that are expected to result in the highest possible level of profits, given the constraints it faces, such as the costs of production, competition, and legal regulations.

It Is Assumed in Standard Economic Theory That a Firm