When a business is maximizing profits it will necessarily be:
A)maximizing profit per unit of output
B)maximizing the difference between total revenue and total cost
C)minimizing total cost
D)maximizing total revenue
E)maximizing average revenue

Question

Quizplus · Accepted Answer

Maximizing profits means achieving the highest profit possible. This can be done by maximizing the difference between total revenue and total cost, which is equal to the profit. Maximizing profit per unit of output (A) or minimizing total cost (C) may help increase profits but it's not the ultimate goal. Maximizing total revenue (D) or average revenue (E) may not necessarily result in higher profits because revenue alone doesn't take into account the costs incurred to produce the goods or services.

When a Business Is Maximizing Profits It Will Necessarily Be