The Firm: Maximizing Profit

In This Chapter

  • What is a profit?
  • The cost structure of a firm
  • Maximizing profits
  • When a firm should call it quits
  • Short-run and long-run decisions of a firm

An entrepreneur who starts a company is enthusiastic about an idea and hopes to launch a profitable business. That’s a worthwhile plan because being creative, building something from nothing, and also being able to make a living doing what you love is the best of all worlds. Every successful business was started by someone with an idea.

This chapter describes what all businesses need to know: how much to produce in order to maximize profits. Each industry ...

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