Question

Which of the following statements is true of costs and pricing​ decisions? A. Companies get profit from selling products only when they are the price makers. B. Companies supply products as long as the price the customer is willing to pay for its products exceeds the price that is charged by the competitor. C. Companies supply products as long as the revenues from selling the additional units exceed the cost of producing them. D. Companies supply products as long as there is a demand for the product in the market regardless of the price at which the products are sold.

Answer 1

The answer is C. Companies supply products as long as the revenues from selling the additional units exceed the cost of producing them.

Step-by-step explanation:

When pricing, the most important factor is the marginal cost and marginal revenue. If the cost of production of 1 additional unit exceeds the extra revenue it could bring in to the organization, then it means it is a loss and therefore should not be produced.