Suppose a firm sells its product at a price lower than the opportunity cost of the inputs used to produce it. Which is true?

Question

Quizplus · Accepted Answer

Selling a product at a price lower than the opportunity cost of the inputs means the firm is not covering the full cost of its resources, leading to economic losses. However, it might still report accounting profits if its sales exceed its explicit costs, not accounting for opportunity costs.

Suppose a Firm Sells Its Product at a Price Lower