In the long run,the seller must price at a level that covers all variable costs of production,contributes to some portion of fixed costs,and contributes to some level of profit.

Question

Quizplus · Accepted Answer

This statement is true. In order for a seller to be profitable in the long run, they must price their product or service at a level that covers all variable costs (such as materials and labor), contributes to some portion of fixed costs (such as rent and salaries), and generates some level of profit. Failing to cover all costs and generate profit can lead to financial difficulties and eventual business failure.

In the Long Run,the Seller Must Price at a Level