A profit-maximizing firm will produce the level of output such that marginal cost is less than rising marginal revenue.

Average total cost is the

When Ford Motor Company reports that it earned a loss of $100 million for the fourth quarter of 2007, the firm is

To an economist, total cost is total accounting cost plus opportunity costs not measured in accounting costs.

Opportunity cost is the full value of the next best alternative.

When diminishing marginal returns occurs, the

Assume that marginal revenue equals rising marginal cost at 100 units of output. At this output level, a profit-maximizing firm’s total fixed cost is $600 and its total variable cost is $400. If the price of the product is $8 per unit, the firm should produce

The opportunity cost of going to the movies is the price of entry into the movies.

Figure 5.2Refer to Figure 5.2. If the firm is incurring losses, we can say with certainty that

Oftentimes last minute deals can be found because firms follow the MC = MR Rule.